Economics/Class Relations

What tech job recession?

August 17, 2023
Hiya! If you’ve dreamed of hanging out with Ashton Kutcher and Mila Kunis, now is your chance. The celebrity couple put their California beach house on Airbnb for a one-night stay. And it’s for free.

Speaking of California, one of the state’s key industries — tech — had a tough start to the year. But the tide is starting to turn.


What’s on deck:

But first, don’t call it a comeback.
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Good news for tech

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It’s been a tough go for tech folks this year. A brutal 2022 saw valuations plummet for startups and giants alike, leading to an initial wave of layoffs.

The tech industry was on shaky ground entering 2023. And it wasn’t long before Big Tech made deep cuts to its workforce. More than 300,000 employees at tech companies were laid off in the first half of the year.

But all that is in the rearview mirror, at least according to tech analysts from Bernstein Research, writes Insider’s Alistair Barr. In a recent email to investors, the analysts called an end to the tech job recession and pondered when hirings will reaccelerate.

Monthly job cuts across the tech industry. Bernstein Research,


A big piece of the tech turnaround is due to the generative AI boom, initially spurred by OpenAI’s ChatGPT. Companies are now scrambling for talent, with some offering salaries as high as $900,000 for AI specialists.

But it’s not all sunshine and rainbows in the world of AI. Storm clouds are forming that could rain on the AI parade and, as a result, the broader tech industry. 

  • Chip conundrum: Nvidia’s GPUs are key to AI development, leading its stock to skyrocket more than 200% this year. But keeping up with demand hasn’t been easy. Complicating matters is Nvidia’s partnership with Tawain-based TSMC. The world’s largest chipmaker delayed plans to open an Arizona factory due to a dispute with US workers. Nvidia’s earnings report next week should clarify how it’s meeting demand. But the risk that Nvidia poses as a key supplier of the wider AI industry remains.
  • Training troubles: Another thorn in generative AI’s side is training. Large language models require massive amounts of text to learn and evolve. But they’re running out of stuff to read, and some companies face lawsuits from authors alleging copyright infringement. Meanwhile, sourcing new forms of training data could prove difficult as companies look to protect their data against being used for training.
  • Overly optimistic: Calling generative AI an overhyped bubble feels like a mischaracterization. It’s undeniable that the tech will profoundly affect everything in our lives. But the timeline remains to be seen, as previous assumptions about AI models haven’t always panned out. So if the AI expectations of tech companies — and their investors — are delayed, there could be more pain to come.

3 things in markets

Before the opening bell: US stock futures are up slightly, after stocks fell Wednesday when Fed minutes indicated inflation concerns remain.
Poca Wander/Getty Images
  1. Inflation-adjusted bond yields in the US have surged to the highest levels since the 2008-2009 financial crisis. The yield on 10-year inflation-protected Treasuries, also known as TIPS, surged to 1.89% on Wednesday.
  2. “Big Short” investor’s latest big short. Michael Burry disclosed sizable bets against the S&P 500 and Nasdaq-100 in a recent portfolio update. While the holdings could be hedges, they could also indicate the famed investor’s opinion on the wider market.
  3. A top Two Sigma exec has taken medical leave amid a critical juncture for the hedge fund. Alex Ginsburg, the firm’s chief investment officer of equities, is a 21-year company vet. His leave comes as the firm grapples with infighting between its cofounders, David Siegel and John Overdeck.
3 things in tech
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  1. Cybertrucks in the wild. Early production models have hit the road, and they’re turning heads and cameras. People are sharing their early sightings online, and Tesla’s first pickup truck looks pretty distinct alongside regular vehicles.
  2. Pettiness is the order of the day for prominent tech bros. Elon Musk’s X appeared to slow down access to websites he doesn’t like. Microsoft’s Satya Nadella suggested it is prioritizing AI to make Google its lapdog. It’s all indicative of petty tech bro summer
  3. Keith Rabois’ startup OpenStore is launching a new program to boost Shopify merchants. The 10-week training program will help businesses optimize their marketing. The first cohort will consist of five merchants generating between $50,000 and $500,000 in net sales annually.
3 things in business
Arantza Pena Popo/Insider
  1. The dirty downside of return to office policies. Commuting to work multiple times a week could make the climate crisis worse. Transportation accounts for around 15% of greenhouse-gas emissions. Plus, passenger vehicles are responsible for a large chunk of that.
  2. Skills > college degree. A LinkedIn study found that job listings are increasingly removing college degree requirements. Recruiters — including at major companies like IBM and Google — are now prioritizing skills in their searches.
  3. The 30 young leaders forging a new future for healthcare. Insider’s annual list includes entrepreneurs, scientists, doctors, and more. They’re improving access to mental-health care, educating others about race in medicine, expanding addiction treatment, and more.

Billionaires, Teslas, & more


Racing, cats, & birthdays

  • Earnings on deck: Walmart, Ross Stores, and more, all reporting.
  • Meow: Happy Black Cat Appreciation Day. The day is supposed to help destigmatize black cats.
  • Happy birthday to Oracle cofounder Larry Ellison. Robert De Niro, Thierry Henry, and Phoebe Bridgers are also celebrating birthdays today.
  • The Camping World SRX Series car racing finale is tonight in Wheatland, Missouri. It’ll happen at 9 p.m. ET and will be broadcast on ESPN.

Historical sites

Keystone-France/Gamma-Keystone via Getty Images
Photos of historical sites before and after being discovered. Comparison images include the Sphinx, Terracotta Army, and Great Ziggurat of Ur.
The Insider Today team: Dan DeFrancesco, senior editor and anchor, in New York City. Diamond Naga Siu, senior reporter, in San Diego. Hallam Bullock, editor, in London. Lisa Ryan, executive editor, in New York City.
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