Amid the massive layoffs seen at Gafam, Apple is weathering the storm. While tens of thousands of employees have been fired by Microsoft, Amazon or even Meta (WhatsApp, Instagram, Messenger), the Cupertino giant has not yet suffered the domino effect. For the moment, he is the only one, in the land of tech giants, not to have announced a massive layoff. His last major series of layoffs dates back to 1997. How to explain that the firm at the apple does not suffer the same fate as its counterparts? And above all, how long will it last?
First explanation: unlike other Big Techs, Apple did not hire aggressively during the pandemic. In 2020, Covid-19 has energized the technology sector. While sales and profits were only increasing, the latter proceeded with many hirings. For its part, Apple preferred to swell its ranks gradually. And the wall street journal did the math: From the end of its fiscal year in September 2019 to September 2022, the company’s headcount grew by around 20%. “Meanwhile, over a similar period, the number of employees at Amazon has doubled, that of Microsoft has increased by 53%, that of Google’s parent company, Alphabet Inc., by 57% and that of the owner of Facebook , Meta, by 94%”, underlines the American daily.
Thus, Apple has tracked the same hiring rate since 2016. As of September 2022, the company employed 164,000 full-time workers, across its corporate and retail divisions. A figure that should not experience significant variations. Evidenced by the words of Apple CEO Tim Cook last July: “We continue to hire, we just do it in a very targeted way.” Fewer recruitments, and therefore less need for recruiters. Last August, they are a hundred to have been thanked.
Savings have been made
Apple had previously laid off a large group of contract workers in 2019 in Cork, Ireland, recalls the specialized media Bloomberg. At the time, the company had several hundred contractors to listen to recordings of Siri conversations in order to improve it. The company also laid off some subcontractors while they were working on the Apple Park campus in 2015. In addition, the firm was less spendthrift than its counterparts. the wall street journal notes that Apple does not offer meals to employees on its campus, unlike what Google and Meta (WhatsApp, Instagram, Messenger) offer.
According to a document sent by Apple to the policeman of the American Stock Exchange, the SEC (Securities and Exchange Commission), unveiled at the beginning of January, Tim Cook has also requested a reduction in his remuneration for the year 2023. Result: he should earn in total $49 million this year, compensation that includes a $3 million salary, $6 million incentive bonus and 40 million stock awards. For comparison, in 2021, the same Tim Cook received $98.73 million. This reduction in remuneration does not happen by chance, since the salary of the general manager was beginning to irritate the shareholders of the Californian company. Today, Tim Cook is one of the richest CEOs in the United States. Forbes estimated his net worth at $1.7 billion.
For now, Apple’s core business has proven resilient in the face of broader market downturns. But that might not last: the smartphone market had its worst year since 2013, with the added bonus of the worst decline ever during the holiday season. A slowdown in demand for products that Gafam failed to anticipate, after a pandemic period favorable to Big Tech. In 2022, Apple lost over $830 billion in market value. Revenue from its services business continued to slow, growing 5% a year to $19.2 billion in the third quarter, below results seen in previous quarters.
And the fourth quarter promises to be difficult for Apple. The company has encountered manufacturing problems in China, where the strict “zero Covid” policy has dampened much economic activity. The firm has more than 90% of its products manufactured by the Asian giant. Not to mention that sales of the Apple Watch and from connected devices have also suffered a severe blow.