<story><title>The widespread layoffs are more because of copycat behavior than cost-cutting</title><url>https://www.businessinsider.com/stanford-professor-mass-layoffs-caused-by-social-contagion-companies-imitating-2023-2</url></story><parent_chain><item><author>pie_flavor</author><text>&amp;gt; I&amp;#x27;m a Stanford professor who&amp;#x27;s studied organizational behavior for decades.&lt;p&gt;And I&amp;#x27;ve actually been &lt;i&gt;inside&lt;/i&gt; an organization or two. It&amp;#x27;s cost-cutting. Companies are ludicrously bloated because caring about it is too much effort for the value; during a downturn, they care a bit more, so they trim a bit of the fat. Musk was the one that pointed out that the emperor has no clothes, but that doesn&amp;#x27;t change how long it&amp;#x27;s been that way for. There&amp;#x27;s always this blind spot with academic types observing the software industry, where they assume that the dysfunction is rumors and the real issue is something thinky and academic (see e.g. the declining value of a CS degree - couldn&amp;#x27;t&amp;#x27;ve been always worthless, must be a supply-and-demand issue), because it&amp;#x27;s just about impossible to fathom how something as dysfunctional as the software industry really is could possibly stand on two feet without falling over, until you&amp;#x27;ve seen it firsthand.</text></item></parent_chain><comment><author>lapcat</author><text>&amp;gt; And I&amp;#x27;ve actually been inside an organization or two.&lt;p&gt;Unless you&amp;#x27;re inside the mind of the CEO, it&amp;#x27;s not clear how this is relevant. And if the CEOs are acting irrationally, it&amp;#x27;s not clear that even being inside their minds would help, because the irrational tend to lack the self-awareness to see their own irrationality.&lt;p&gt;The professor doesn&amp;#x27;t claim to be inside their minds either. The point is that, empirically, layoffs very often fail to bring about any economic improvements to the company, and may indeed hurt the company in the long run.&lt;p&gt;It&amp;#x27;s a matter of penny-wise but pound-foolish.</text></comment>
<story><title>The widespread layoffs are more because of copycat behavior than cost-cutting</title><url>https://www.businessinsider.com/stanford-professor-mass-layoffs-caused-by-social-contagion-companies-imitating-2023-2</url></story><parent_chain><item><author>pie_flavor</author><text>&amp;gt; I&amp;#x27;m a Stanford professor who&amp;#x27;s studied organizational behavior for decades.&lt;p&gt;And I&amp;#x27;ve actually been &lt;i&gt;inside&lt;/i&gt; an organization or two. It&amp;#x27;s cost-cutting. Companies are ludicrously bloated because caring about it is too much effort for the value; during a downturn, they care a bit more, so they trim a bit of the fat. Musk was the one that pointed out that the emperor has no clothes, but that doesn&amp;#x27;t change how long it&amp;#x27;s been that way for. There&amp;#x27;s always this blind spot with academic types observing the software industry, where they assume that the dysfunction is rumors and the real issue is something thinky and academic (see e.g. the declining value of a CS degree - couldn&amp;#x27;t&amp;#x27;ve been always worthless, must be a supply-and-demand issue), because it&amp;#x27;s just about impossible to fathom how something as dysfunctional as the software industry really is could possibly stand on two feet without falling over, until you&amp;#x27;ve seen it firsthand.</text></item></parent_chain><comment><author>rhaway84773</author><text>Your explanation fails to answer why these same companies were hiring people at highly inflated salaries only a year ago, whereas the academic type explanation fully covers that scenario as well.</text></comment>