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Big Tech Layoffs Tied to Record Inflation in 2022

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Layoffs at Big Tech behemoths such as Twitter, Amazon.com, and Meta Platforms (Facebook) are the first on a large scale since early 2020.

Layoffs at Big Tech behemoths such as Twitter, Amazon.com, and Meta Platforms (Facebook) are the first on a large scale since early 2020.

After years of falling unemployment in the United States, it may appear that Silicon Valley is heralding the start of a dystopian future for workers. However, there is a good chance that what happens in Silicon Valley will not affect the rest of the economy.

A few years ago, big tech firms were quick to hire. After the pandemic struck in 2020, it took four months for employment in the “other information” sector to return to pre-pandemic levels. In comparison, total employment did not recover for another 29 months.

Regarding firing, Big tech in Silicon Valley is also ahead of the curve. Rising interest rates make capital more expensive, forcing businesses to cut spending on future projects.

This is especially difficult for tech companies that rely heavily on innovation to drive growth. Elon Musk cut Twitter’s headcount in half in November to cut costs. Employment has since fallen further as dissatisfied employees resign.

Companies are still hiring elsewhere. In September, there were roughly two job openings for every available worker.

According to Indeed, job postings for restaurant workers were up 38% from pre-pandemic levels as of Nov. 10. Listings for hospitality and tourism are 15% higher than they were previously.

Big Tech layoffs and slower hiring

Could Silicon Valley’s aches and pains spread? That depends on the Federal Reserve, which is mandated to reduce inflation from 6.3% to 2%, excluding food and energy prices.

In September, officials warned that the fight would almost certainly result in layoffs and slower hiring. According to the Fed’s projections, unemployment will reach 4.4% in 2024, implying that 1.2 million more people will be out of work.

Nonetheless, inflation appears to have peaked in June. On Wednesday, Fed Governor Christopher Waller suggested that such a trade-off might be avoidable.

This raises the prospect of a tech-specific adjustment rather than a white-collar recession. That’s not much consolation for employees returning their door badges. However, it suggests that Silicon Valley’s modest purge may be the worst it gets.

Amazon.com, Twitter, Meta Platforms, and other technology companies have recently laid off tens of thousands of workers as executives look to cut costs and prepare for slower growth.

According to the Federal Reserve, rising interest rates could lead to higher unemployment. Fed Chair Jerome Powell has repeatedly emphasized high job openings as a sign of an imbalanced labour market.

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Inflation killing jobs

Inflation data released on November 10 showed that prices rose 7.7% yearly through October. This is a decrease from the previous month’s rate of 8.2%.

According to a KPMG study, at least 91 percent of top job creators are bracing for a Biden Recession, with more than half considering layoffs in the next six months.

“America’s CEOs are becoming an increasingly pessimistic group as inflation rages, and the Federal Reserve keeps hiking interest rates,” according to Fox Business.

Another recent survey found that more than a third of chief financial officers (CFOs) believe the United States is either in a recession or will be by the end of the year.

Layoffs at Big tech companies in the United States and Europe have recently increased due to record inflation, higher energy costs, and central banks aggressively raising interest rates, which has fueled recession fears.

During the coronavirus pandemic, technology companies increased hiring to meet increased consumer demand, but the tables have turned in 2022.

Global inflation has reached its highest level in nearly 40 years, forcing central banks to raise interest rates in late 2021, significantly reducing the amount of capital and liquidity available in markets for investment.

Major technology companies have been laying off employees or putting new hires on hold at an unprecedented rate to cut costs.

According to the data tracker website Layoffs.FYI, 788 tech companies have laid off 120,699 employees worldwide since the beginning of 2022.

According to a report by business information provider Crunchbase, over 67,000 workers in the US technology industry have been laid off this year.

Source: Reuters

Business

Apple IPhones Sales Fall 24% In China Amid Competition And Headwinds

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According to a new report, iPhone sales fell 24% in the first six weeks of 2024, posing substantial challenges for Apple and other Western technology businesses in a critical market.

According to Counterpoint Research, the overall mobile market in China declined by 7%, with businesses such as Apple, Oppo, and Vivo seeing decreases.

However, the difficulty for Apple has been ongoing for a year; as China’s economy has weakened, trade tensions and nationalism have risen. Counterpoint reported that customers who may have previously considered now opt for national brands, namely Huawei.

apple

Apple IPhones Sales Fall 24% In China Amid Competition And Headwinds

“Primarily, faced stiff competition at the high end from a resurgent Huawei while getting squeezed in the middle by aggressive pricing from the likes of Oppo, Vivo, and Xiaomi,” Mengmeng Zhang, a Counterpoint senior analyst, stated in a press statement. “Although the iPhone 15 is a great device, it has no significant upgrades from the previous version, so consumers feel fine holding on to the older-generation iPhones for now.”

Apple shares fell 2.8% on Tuesday. The stock has lost 11.6% this year due to concerns about slowing sales, notably in China.

The corporation did not respond to a request for comment.

The research comes amid a faltering Chinese economy, a challenging housing market, increasing unemployment among younger workers, and increased rivalry among higher-end vendors in China, particularly from Chinese device giant Huawei.

China is an important market for the company, as it is the second largest after the United States. Apple previously achieved significant gains during its launch period last year. The company continues to give discounts to assist in alleviating some of the downturn.

apple

Apple IPhones Sales Fall 24% In China Amid Competition And Headwinds

Last year, Huawei’s Mate 60 made headlines when the US authorities requested further information on the Pro variant, which included a sophisticated CPU. Its appearance astounded industry observers, who questioned how the company could produce such a device in the wake of the United States’ extensive attempts to limit China’s access to foreign semiconductor technology due to alleged national security concerns.

Some Chinese buyers believe US government sanctions have victimized them and are gravitating toward Huawei’s Mate 60 smartphone, which is approaching Apple sales.

According to Jeff Fieldhack, a research director at Counterpoint, one issue is that Apple had a strong January last year owing to part shortages but did not have any shortages this year.

apple

Apple IPhones Sales Fall 24% In China Amid Competition And Headwinds

“This isn’t a major deal for Apple in the long term,” he added. “It is still a successful iPhone launch and there is more discounting and marketing they can do this year in China to help alleviate the competition from Huawei.”

In January, Huawei held 17% of the mobile market in China, compared to the iPhone’s 16%. Huawei’s demand exceeds its supply, implying that it might sell more, according to Fieldhack.

“Apple, to its credit, ended the year at number one, which was extraordinary despite headwinds from China,” added the analyst.

SOURCE – (CNN)

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Microsoft Says It Hasn’t Been Able To Shake Russian State Hackers

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BOSTON — Microsoft said Friday that it is still working to evict the elite Russian government hackers who broke into senior business officials’ email accounts in November and are attempting to enter consumer networks using stolen access data.

According to the software giant’s blog and regulatory filing, the hackers from Russia’s SVR foreign intelligence service used data gained during the intrusion, which was exposed in mid-January, to compromise some source-code repositories and internal systems.

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Microsoft Says It Hasn’t Been Able To Shake Russian State Hackers

A corporate official declined to specify the source code and capabilities the hackers gained to further attack customers and systems. Microsoft claimed Friday that hackers obtained “secrets” from email contacts between the business and certain customers, including cryptographic secrets like passwords, certificates, and authentication keys, and that it was contacting them “to assist in mitigating measures.”

Hewlett Packard Enterprise, a cloud computing business, revealed on January 24 that it was also an SVR hacking victim and had been notified of the breach — by whom it would not say — two weeks earlier, coinciding with the revelation that it had been compromised.

“The threat actor’s ongoing attack is characterized by a sustained, significant commitment of the threat actor’s resources, coordination, and focus,” the company said Friday, adding that it may be utilizing acquired data “to accumulate a picture of areas to attack and enhance its ability to do so.” According to cybersecurity experts, Microsoft’s admission that the SVR hack had not been contained highlights the risks of government and business relying heavily on the Redmond, Washington-based company’s software monoculture — and the fact that so many of its customers are linked via its global cloud network.

microsoft

Microsoft Says It Hasn’t Been Able To Shake Russian State Hackers

“This has tremendous national security implications,” said Tom Kellermann of the cybersecurity firm Contrast Security. “The Russians can now leverage supply chain attacks against Microsoft’s customers.”

Tenable’s CEO, Amit Yoran, also published a statement expressing shock and dismay. He is among security pros who believe Microsoft is extremely secretive about its vulnerabilities and how it handles intrusions.

“We should all be furious that this keeps happening,” he continued. “These breaches aren’t isolated from each other and Microsoft’s shady security practices and misleading statements purposely obfuscate the whole truth.”

Microsoft said it has yet to establish if the incident will have a material impact on its profitability. It also stated that the intrusion’s persistence “reflects what has become a more broadly unprecedented global threat landscape, especially in terms of sophisticated nation-state attacks.”

The hackers, known as Cozy Bear, are the same ones responsible for the SolarWinds breach.

microsoft

Microsoft Says It Hasn’t Been Able To Shake Russian State Hackers

When Microsoft first reported the intrusion, it stated that the SVR unit got into its corporate email system and accessed the accounts of certain senior executives and staff from its cybersecurity and legal departments. It did not specify how many accounts were compromised.

At the time, Microsoft stated that it could terminate the hackers’ access to the compromised accounts on or around January 13. But by then, they had certainly established a footing.

It said they gained access via compromising credentials on a “legacy” test account but did not elaborate.

Microsoft’s newest disclosure comes three months after a new Securities and Exchange Commission rule went into effect, requiring publicly traded corporations to disclose breaches that potentially harm their businesses.

SOURCE – (AP)

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Dodge Muscle Cars Live On With New Versions Of The Charger Powered By Electricity Or Gasoline

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DETROIT — America’s muscle car culture will endure while the country shifts to electric vehicles, but the gas-powered performance automobile will be there for at least a few more years.

On Tuesday, Dodge debuted two battery-powered Charger muscle cars that still roar like a large V8 engine but emit no pollution from the tailpipe.

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New iterations of the Charger that run on gasoline or electricity continue to be Dodge muscle cars.

However, the Stellantis brand, which has carved out a market niche for high-performance vehicles, will continue selling a gas-powered Charger without the large Hemi V8.

Both will be based on Stellantis’ worldwide large vehicle platform, and the Windsor, Ontario, factory that will produce them will be able to switch between gasoline and electric power depending on market demand. Stellantis’ flexibility will allow it to hedge its bets on whether electric vehicle sales take off or slow.

Last year, Stellantis discontinued production of the gas-powered Chargers and Challengers, and many believed it would be the end of the thundering sedans.

However, Dodge CEO Tim Kuniskis hinted that a gasoline version would continue to exist. “It was always there.” It was always in the plans. “It was always coming,” he explained.

dodge

Dodge Muscle Cars Live On With New Versions Of The Charger Powered By Electricity Or Gasoline

However, the business downplayed the gas version in favour of two- and four-door electric variants that resemble Chargers from the 1960s, with aerodynamic lines and hatchbacks rather than trunks.

The electric versions, branded Charger Daytona after the NASCAR raceway in Florida, will have two powertrains, one with up to 670 horsepower and the ability to accelerate from 0 to 60 mph (97 km/h) in 3.3 seconds. The other is no slouch, with 496 horsepower and a zero to 60 time of 4.7 seconds.

Dodge boasts that its high-performance electric version is the world’s fastest and most powerful muscle car. Next year, an even higher-performing version will be released.

The 496-horsepower Daytona is predicted to have a range of 317 miles (510 kilometres) per charge, while the high-performance version can travel 260 miles (418 kilometres).

Both will include the company’s Fratzonic Chambered Exhaust, which routes air through a chamber to replicate the roar of a V8.

Both are hefty because of their large batteries, with gross vehicle weights of more than three tons.

The new gas-powered Charger Sixpack will have a similar design to the electric variants and be powered by a new 3-litre six-cylinder engine with two turbochargers. Standard variants will generate 420 horsepower, while high-output engines will produce 550.

According to the firm, the new engine will produce more horsepower and torque than the previous 5.7- and 6.4-liter Hemi V8s. According to company executives, fuel efficiency tests on the Charger’s new engine still need to be finished.

dodge

Dodge Muscle Cars Live On With New Versions Of The Charger Powered By Electricity Or Gasoline

All variants have all-wheel drive, although they can be converted to rear-wheel drive, so owners may still experience burnout and drift. There will be alternatives to prepare the automobiles for the racecourse.

The two-door coupe Daytona models are anticipated to go into production this summer, while the electric four-door and gas-powered versions will begin early next year.

Kuniskis said he is still determining which kind will sell better, electric or gas. With federal tax breaks on electric vehicles, leasing payments are anticipated to be quite appealing, which could convince some consumers, he added.

Environmentalists will almost definitely attack the firm for releasing EVs that prioritize performance efficiency while maintaining the gas-powered muscle car. However, Kuniskis stated that in typical circumstances, approximately 17 million new vehicles are sold annually in the United States.

“It’s a 17 million unit industry,” he said. “And you know what? People require options,” he added, adding that the corporation could face criticism if it did not produce electrified versions.

SOURCE – (AP)

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