Will Tech Companies Continue to Shrink in 2023

Microsoft is the latest large U.S. tech company to reduce its staff numbers. Over the last few months, many tech companies have terminated significant numbers of their employees in response to a more challenging economic environment.

Commentators have noted that this is a natural reaction to the over-hiring we saw throughout 2020 as companies anticipated higher demand that was not sustainable. Although the macroeconomic headwinds plaguing public U.S. companies have not yet subsided, we have seen improvements in the economic data released.

It may still be too early to tell if 2023 will see a recovery in the U.S. markets, but with the economy recovering from 2022, we may see a slowdown in the number of companies reducing their staff.

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