Threat of Recession Looms Amid Growing Layoffs at Fortune 500 Companies | Eastern North Carolina Now

    Publisher's Note: This post appears here courtesy of the John Locke Foundation. The author of this post is Brittany Raymer.

    There's a lot of talk about a looming recession, and that reality seems more definitive as several Fortune 500 companies are planning on laying off tens of thousands of employees. From Amazon and Disney to Meta and Twitter, all of these corporations are reacting to the rising inflation and downturn in the economy by culling some of their staff.

    Though the pink slips are flying, the Biden administration seems immune to the economic reality that there are some serious problems brewing within the jobs sector.

    In a November 4, 2022, statement, Biden said, "Today's jobs report - adding 261,000 jobs with the unemployment rate still at a historically low 3.7% - shows that our jobs recovery remains strong."

    Those words may come back to haunt the president, as earlier today ABC news reported a list of major companies that are all seeking to terminate employees to save costs and in reaction to rising inflation.

    Amazon, one of the largest companies in the world, confirmed on Wednesday that it has started to layoff 10,000 employees. Those impacted will mostly be on the devices and services team.

    In a statement to CNN, Amazon spokesperson Kelly Nantel, said, "As we've gone through this, given current macro-economic environment (as well as several years of rapid hiring), some teams are making adjustments, which in some cases means certain roles are no longer necessary."

    Last week Meta, parent company of Facebook and Instagram, laid off a similar number of employees, roughly 11,000 or 13% of the workforce. CEO Mark Zuckerberg cited a decline in ad revenue and increased competition as the reason. The additional billions pumped into the Meta Verse, an alternate reality where people could work, go to concerns and exercise, is also seen as a risky bet pulling down the company's operations.

    In a memo to employees, Zuckerberg explained, "I got this wrong, and I take responsibility for that."

    Disney is also reportedly looking to downsize their work force, with a leaked memo showing CEO Bob Chapek instituting a hiring freeze and looming layoffs.

    According to reports, Chapek said, "We are limiting headcount additions through a targeted hiring freeze...As we work through this evaluation process, we will look at every avenue of operations and labor to find savings, and we do anticipate some staff reductions as part of this review."

    Twitter also laid off about half of its workforce, though some of that is due to the reorganization being instituted by Elon Musk.

    Some other companies that are planning, or have initiated, layoffs include Microsoft, Lyft, Stripe, Redfin, Salesforce and more. While some of this restructuring is a result of the hiring binge during the pandemic, recession is still at the top of economists' minds.

    Jeff Bezos recently warned Americans and small businesses to eliminate risk and stock pile cash, as "things are slowing down" and it's time to "batten down the hatches."

    How all of this will affect the job market is unclear, but it seems the economy isn't as rosy as some in the administration would like people to believe.

    In North Carolina, every county has continued to see a drop in unemployment, except for one. The job situation in North Carolina remains strong, but with some of the nation's largest and most influential companies decreasing the workforce, that has a tendency to trickle into other areas of the country.

    Given that it's mostly white-collar workers getting hit right now, of which the Raleigh and Charlotte area have many such employees, these high paying jobs could bear the brunt of the economy's contraction.

    With Russia already in a recession, the U.K. on the brink and China's economy slowing down, the United States may not be too far away.

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