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How recent tech layoffs can disproportionately affect women and people of color
As the industry downsizes amid economic uncertainty, data suggests all workers haven’t been affected equally.
In recent years, tech companies have invested billions into beefing up diversity and equity efforts, claiming they wanted to address long-standing demographic inequities.
But as tens of thousands of tech workers have been laid off over the past several months, research suggests that women and people of color have been disproportionately affected.
WHEN HALF ISN’T EVEN
According to Layoffs.FYI, which tracks tech industry cuts, an estimated 45% of those who lost their jobs in the recent wave of layoffs were women. While the dismissals split almost evenly across gender lines, women account for less than a third of tech industry workers and occupy less than a quarter of technical and leadership roles, according to a 2022 study by Deloitte.
“A close to 50-50 split is actually pretty notable because generally the workforce is not 50-50,” explains Layoffs.FYI’s creator, Roger Lee. The online database cataloged over 150,000 layoffs in 2022, but according to Lee half occurred in just the last two months of the year. “The pace definitely picked up at the end of the year,” he says, adding that the numbers continue to rise. As of January 23, the website had tracked more than 56,500 layoffs this month—more than a third the total number of layoffs in all of 2022.
Lee says he ran the names of 1,258 recently laid off tech workers, who voluntarily provided them to industry recruiters, through a gender analyzer, which categorized 44.8% as “likely female.”
A separate study conducted by Revelio Labs that used data from Layoffs.FYI found that female staff accounted for 47% of dismissals between September and December of 2022, and another study conducted by Paychex found that nearly three quarters of female tech workers fear being targeted for layoffs.
A recent lawsuit launched by two former employees also accuses Twitter of disproportionately targeting female staff, claiming the company cut 57% of the women in its workforce, compared to just 47% of men.
FEMALE EMPLOYEES DISPROPORTIONATELY WORK IN VULNERABLE DEPARTMENTS
One potential explanation for the discrepancy, says Lee, is that sales, marketing, and other customer-facing roles accounts for roughly 20% of the cuts, while recruiting and HR are the most disproportionately affected, with many cutting their talent teams in half.
“HR, recruiting, and customer-facing roles tend to comprise more women than other departments, like engineering,” says Lee. “The engineering department makes up a very low percentage of these layoffs, especially relative to their size.”
Lee doesn’t have data comparing how recent layoffs are affecting other underrepresented groups in the tech industry just yet, but suspects to find the same pattern once data is available. The Revelio Labs study identified 11.5% of those laid off last fall as Latino, despite Latino workers comprising less than 10% of the industry, and Tech industry magazine Protocol identified at least 40 people from marginalized backgrounds who lost their jobs at Netflix last spring.
WHEN SOLUTIONS EXACERBATE THE PROBLEM
The disconnect between the industry’s grandstanding on DEI in recent years and its approach to recent layoffs was not unexpected, according to industry researchers.
By 2016, several high-profile wrongful dismissal cases had spooked employers into formalizing their process for layoff decision-making, says to Alexandra Kalev, who conducted a study of over 800 U.S. companies and published her findings in the Harvard Business Review in 2016.
“Over time, we see more and more usage of one or two criteria regarding whom to lay off, but these criteria are ironically discriminating, because one criterion is ‘last in, first out,’” says Kalev, who chairs the Department of Sociology and Anthropology at Tel Aviv University.
The “last in, first out” principle suggests that the most recent hires are the most vulnerable to cuts, and a recent ZipRecruiter study confirms that newer employees are at a higher risk of being let go. While this criterion is often utilized in the interest of transparency and fairness, women and workers of color are statistically more likely to fall into this category.
A study conducted by AnitaB.org, a nonprofit that seeks to advance the participation of women in the technology industry, suggests that female representation in the tech industry declines sharply with seniority. It found that 38.5% of interns and 33.8% of entry-level workers identify as female, compared with just 28% of midcareer and 23.1% of senior and executive staff. The industry also has a long history of struggling to attract and retain members of other minority groups, meaning that these team members often have the shortest tenures.
According to Kalev’s 2016 study the last-in, first-out approach results in a net loss of 19% of white women in management and a 14% drop in the share of Asian men.
Along with tenure, the other common metric used for layoff decisions was department, which is consistent with Layoffs.FYI’s findings regarding customer-facing and human resources positions, and which also tend to have higher proportions of female staff.
Despite the talk about DEI in recent years, Kalev says she has no reason to believe this round of layoffs will be any different than those she studied in 2016.
“Over the last five or six years, and especially since George Floyd, you’ve heard so much discourse around diversity and inclusion and racial justice and transparency and promises to the public,” she says. “That voice is silent now.”
MAINTAINING DEI WHILE DOWNSIZING
Rather than leaning on metrics that seek to take representations out of the equation, Kalev’s research suggests the best way to avoid disproportionately cutting underrepresented groups is to simply make that part of the decision-making process. She explains that when times are tough, leaders are under pressure to make quick decisions, warning that under those conditions biases are more likely to rear their ugly head. “The only way not to lose your diversity is to make a plan not to lose it,” she said. “Make that the goal—to downsize or lay off without losing the proportions.”
It’s also important not to lose sight of why diversity is so important in the tech industry specifically.
“When we’re talking about artificial intelligence and the algorithms that go into that, when we’re talking about facial recognition, these are technologies that can dramatically affect things like people’s credit scores, or whether they get picked up by the police,” says Sarah Kaplan, the director of the Institute for Gender and the Economy at the Rotman school of management at the University of Toronto.
Kaplan points to research which suggests the pandemic reduced the number of women—and especially women of color—in tech, adding that the industry hasn’t fully recovered from that loss. She adds that dwindling numbers of women and people of color in tech will have far-reaching implications for everyone, not just those directly affected by cuts.
“If you don’t have a diverse workforce, you’re going to get technologies that exacerbate inequalities in our society,” she said. “We should care that the tech sector is not diverse, because it’s creating technologies that shape our lives.”