Why tech layoffs continue to happen despite a strong U.S. economy

The technology sector is celebrating 2024 in a big way. Nvidia beat earnings expectations. The development of artificial intelligence is in full swing. The tech-heavy Nasdaq is up more than 8 percent year to date.

The U.S. economy is also doing surprisingly well, adding 353,000 jobs in January, ahead of economists' forecasts. Warmer-than-expected inflation data could prevent the central bank from cutting rates when the market expects them to, a sign that the economy is strong enough to support tighter monetary policy over the long term.

It's a different story for technical staff.

„Layoffs as early as 2024 signal a dramatic shift in the tech industry,” said Jeff Schulman, a professor at the University of Washington's Foster School of Business. „We're going to continue to see layoffs because the future of technology has changed, investors' appetite for risk and growth and profitability has changed dramatically, and the future of work has changed.”

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