As economy cools, scattered layoffs put an end to dream jobs for some workers
After a period of incredible job growth, many economists are calling it a cooling off.
It started last winter — in February — with Peloton. The home fitness company whose stock price more than quadrupled in the pandemic, announced it was cutting 2,800 jobs.
Since then, there have been more layoff announcements from other high-flyers such as Coinbase, Netflix, Tesla and more.
"I think a helpful way to think about what is happening in the labor market right now is that we're seeing some of that frothiness abate," says AnnElizabeth Konkel, an economist with the Indeed Hiring Lab.
It's little consolation for the worker whose job is lost.
A new job opened the door to the corporate world
Last October, a week before Tanisha Bates started a new job, she decided to spruce up her home office. She tore out the carpet and put in new floors, painted the walls, and even set up a coffee bar.
"I'm going to be working from home, so I need it to be my happy, my Zen zone," Bates recalls thinking at the time.
She'd worked a couple of administrative jobs in schools and before that, in retail. But she'd had her eye on the corporate world where she knew the money would be better and the work more fulfilling.
Sure enough, in 2021, a great opportunity surfaced with Stitch Fix. The online personal styling company was looking for recruiting coordinators to diversify its team of stylists.
The job was everything she'd hoped for. She got to work on an initiative she believed in — helping Stitch Fix to build a more diverse workforce. Also, the pay was great, and she could work from home.
"I felt like I finally had this perfect work-life balance," says Bates.
Layoffs came suddenly but were not entirely a surprise
It all came to abrupt end on June 9. Bates was among the 330 people Stitch Fix laid off, citing a drop in membership and an uncertain economic environment.
It wasn't entirely a surprise. A few months earlier, Stitch Fix's leadership had told its employees that things weren't going so well. Bates had taken note of the the layoffs happening at Peloton and elsewhere.
"I knew it had to happen," says Bates. "It just felt super defeating."
Konkel points out that while job postings in fields such as human resources and software development are down in recent months, they remain elevated, well above where they were before the pandemic.
"My hope is that for these individuals who have been laid off... hopefully they can capitalize on the strength of the labor market," says Konkel.
There were 11.3 million job openings in the U.S. at the end of May, according to the Labor Department, down from a record high set in March of 11.9 million.
A recent grad sees job rescinded before he even starts
In Chicago, Andrés Crucetta is hoping the strong labor market proves fruitful, again.
Crucetta had just finished up his master's degree in computer science and public policy in Chicago and was about to head out to San Francisco for a job with a tech startup when he got an email from the head of engineering.
Crucetta read the word "update" and knew immediately something was up.
"It's almost like when you get a text for a breakup and you're like, 'Oh, here we go. She wants to go for a walk,'" he says.
It had only been about a month since Crucetta had accepted the job. But in this economy, things change quickly. Five days before he was to start, he was informed that the company had implemented a hiring freeze.
He cried for a little bit and then got to work undoing his plans. He had an airplane ticket and a sublease in San Francisco that needed to be canceled. He had to quickly find temporary housing in Chicago while he resumed his job search.
As an international student from Venezuela, Crucetta has 90 days from graduation to figure something out.
"I'm very hopeful," he says. "I think it's just a matter of going through the process again."
Searching for a job feels different in summer 2022
Bates, who is also back on the job hunt, says things feel different from last fall. Hiring managers seem less engaged. Finding talent seems to be on the backburner, she says.
She has put in more than 70 job applications and thinks she may have to start considering in-person positions, leaving her beloved home office and that perfect work-life balance behind.
"Remote jobs are so competitive, because everybody from across the U.S. is applying. It's like going up against the masses," she says.
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