Best time in history to get laid off by big tech
What we learned from tracking layoff benefits
Tech layoffs are finally slowing down. You can see it in this very cool visual from TechCrunch:
We’re also beginning to see recovery in the tech stock market, and our own Compa Index data shows signs of recovery since early Q2.
So I’ve decided to end tracking layoff benefits from the 2022/2023 tech crash and crunch some numbers to reflect on what we learned.
Best time in history to get laid off by big tech
The transition from an historically competitive labor market to the crash happened almost overnight.
I believe that speedy transition drove an employer brand calculation into decisions about layoff benefits, as I wrote about here back in November 2022:
So, for a brief period, layoff benefits were incredibly rich.
I’m not making light anything — layoffs are profoundly disruptive and stressful, even from large companies. Startups laid off thousands too, and they couldn’t afford to offer lucrative packages. And when many startups folded, everyone lost their jobs.
For the companies we tracked, they almost certainly offered above-market layoff benefits.
Why else would you go above and beyond describing the lavish packages?
By the numbers
We tracked benefits packages from layoff events between June 6, 2022 and June 27, 2023 across 40 companies, some of which had multiple layoffs.
December, January, and April had the richest packages in terms of weeks severance; especially January across many layoffs.
The top overall companies were Salesforce, Spotify, and Hubspot, all of which offered 20 weeks of severance (nearly five months!).
Many other companies paid 16 weeks or more. (And note that disclosures typically represented minimum weeks; many employees got more).
What do these companies have in common?
They are overwhelmingly software companies
They are overwhelmingly Bay Area based
At these companies, the HR teams (and Boards) are dialed to compete for the top talent in the world.
So when they ran layoffs, they paid well; and innovated in some new practices.
Emergence of new practices
In big tech, layoffs packages aren’t just weeks of severance pay and benefits coverage continuation anymore.
The big new change was acceleration of stock vesting. A whopping 70% of companies offered some kind of acceleration benefit, ranging from:
As much as 6 months vesting acceleration from both Microsoft and Zoom
Elimination of 1-year cliffs (many companies laid off newly hired talent)
Pro-rata vesting
Extended exercise windows
A typical tech offer package is loaded with stock; in a way, it makes sense that layoff packages are too. Cash preservation is king.
Other interesting practices:
50% of companies offered immigration support, ranging from dedicated white-glove service to triage visa issues, to off-the-shelf vendor hotlines
30% offered mental health coverage. This ranged from free counseling (the high end) to continuation of apps like Calm and Headspace (the low end)
23% allowed employees to keep their laptops, or an allowance to buy one
A handful offered free subscriptions to their own products (Gusto, Lattice, Udemy)
I hate to say it, but I think the rich packages are behind us and layoffs will continue for sometime. With all the fervor gone, laying off talent has less brand risk.
The data will continue to live on our website here.
Hopefully we don’t have to dust this off and start tracking again anytime soon.
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