The software company Atlassian has decided to cut 500 workers — equating to 5% of its workforce — as the firm funnels more resources into growth divisions like cloud computing.
However, with the company's headcount more than tripling since 2019, it's no surprise that the company has decided to follow in the footsteps of other tech firms that have made recent layoffs like Meta, Citigroup, and Wix.
Atlassian Lays Off 500 Workers to “Rebalance Priorities”
As the tech sector continues to contend with Covid-induced overhiring efforts and a bleak economic outlook, Atlassian has decided to cut 5% of its workforce.
The company's co-founders and joint CEOs, Mike Cannon-Brookes and Scott Farquhar, informed workers about this decision by email, explaining that the cuts were about rebalancing the team to “better position Atlassian for the long term”.
“We have made the difficult decision to rebalance our team to better position Atlassian for the long term” – Mike Cannon-Brookes and Scott Farquhar, Co-Founders and CEOs of Atlassian
“A month back we reorganized our company to better reflect operating in a changing and difficult macroeconomic environment” the CEOs write in their blog post, before adding “while it helped us streamline work, we need to go further in rebalancing the skills we require to run faster at our company priorities”.
The company also points out that these layoffs are not a reflection of Atlassian's financial performance, before listing their various growth opportunities including cloud migrations, and IT service management.
Atlassian also noted that they will be providing a number of benefits to axed employees including a global separation package, six months of healthcare benefits, and Visa support to those in need.
Big Tech's Layoffs Continue
Unfortunately, as dismissals in the tech sector exceed 100,000 this year alone, Atlassian isn't the only software company that's been forced to make difficult decisions.
As tech firms deal with overhiring efforts throughout the pandemic and a turbulent economic outlook driven by rising inflation rates and wavering consumer demand, some of the biggest names in the industry are making radical cuts to their headcount.
Microsoft has sent a staggering 10,000 staffers packing, in one of “the most challenging” times of the company, Meta is considering making a second round of layoffs and similar actions have been made by a slew of companies like Spotify, PayPal, and Wix.
Despite these sweeping layoffs, the tech industry is still showing healthy signs of growth. However, as corporate trust in tech erodes, and fresh talent continues to be deterred from applying for jobs in the field, it's uncertain how long this expansion will last.