Tech job losses on course to exceed 2022 number, already at 57% of last yr

Thousands of layoffs in India's key start-up centres point towards more job losses in 2023 than in the previous year at the current pace.

Some 8,134 employees have reportedly lost their jobs in the country as of May 2023 according to data from tech sector job cuts tracker Layoffs.fyi (chart 1). The database collates figures which appear in various media reports. This is not an exhaustive list, but can be considered broadly indicative of the trend in technology companies, amid an adverse funding environment and the global economic slowdown.

The number so far in 2023, in the fifth month of the year, is already 57 per cent of the 2022 number. There were 14,224 layoffs in 2022, a steep rise from the 4,080 job cuts seen in 2021. The number was also higher than what was seen in the first year that the Covid-19 pandemic went global in 2020 when 12,932 jobs were lost. However, the pace of job losses in India seems slower than elsewhere. Globally, 683 companies laid off 194,659 people in 2023. This is already 18 per cent more than the 164,591 seen in 2022.

In Q1CY2023, funding of Indian start-ups reportedly declined 75 per cent to $2.8 billion, according to data from start-up tracker Tracxn Technologies.  

Among the tech companies in India, education-related start-ups are the worst affected with the maximum number of layoffs, shows data. The sector laid off twice as many employees as the next biggest sector in terms of job losses in 2023. Otgher sectors with most layoffs include retail (1,162), food (915), consumer (718), and healthcare (561). Other affected sectors include finance, transportation and data. (Chart 2).

Out of all the cities, Bengaluru reported the the highest layoffs in 2023. The city also has the highest degree of start-up activity in the country. Other places which have seen a large number of layoffs include Gurugram, Mumbai, Chennai, and New Delhi.  (Chart 3).