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January 13, 2024 | Recession Watch: Spiking Layoffs – Citigroup, Twitch, and Pixar, oh my…

John Rubino is a former Wall Street financial analyst and author or co-author of five books, including The Money Bubble: What to Do Before It Pops and Clean Money: Picking Winners in the Green-Tech Boom. He founded the popular financial website in 2004, sold it in 2022, and now publishes John Rubino’s Substack newsletter.

Healthy economies have a natural background rate of hiring and firing, as employers adjust to changes in their environment. But when the firing part of the process starts to dominate, trouble frequently follows.

This might be one of those times, based on the surge in layoff announcements by brand-name companies. Here’s a list that just appeared on Linkedin:

  • Universal Music Group will lay off hundreds of jobs this year, primarily in its recorded music division, Bloomberg writes. The company had roughly 10,000 workers at the end of 2022.
  • Citigroup is eliminating 20,000 jobs in order to cut costs by $2.5 billion, Bloomberg reports.
  • NBC News is cutting 50 to 100 workers, according to Deadline. The media outlet had about 3,500 total employees as of 2023.
  • Disney’s Pixar is poised to reduce its headcount by as much as 20% this year, TechCrunch writes, which may include staff hired for Disney+.
  • Discord is cutting 17% of its employees, or about 170 people, in order to “sharpen” its focus, The Verge reports.
  • Google is reorganizing its Devices & Services team and laying off “a few hundred roles” across the division, primarily in its augmented reality hardware team, according to 9to5Google.
  • Amazon is letting go of hundreds of Prime Video and MGM Studios workers, The Hollywood Reporter writes, as well as 5% of its Audible staff.
  • Livestreaming site Twitch is cutting 500 employees representing 35% of its staff, Bloomberg says. The layoffs follow the departure of several top executives and concerns around Amazon-owned Twitch’s losses.
  • BlackRock is laying off 3% of its global workforce, or roughly 600 people, Bloomberg writes, though it still plans to hire in some segments.
  • The National Football League has offered buyouts to around 200 of its 1,100 staff, CNBC reports, just ahead of the start of playoffs.
  • Rent the Runway is letting go of 10% of its corporate employees, including its COO, Bloomberg writes.
  • Unity Software, which makes products used in the creation of video games, is letting go of some 1,800 people, Reuters reports. The cuts represent 25% of its workforce.
  • Duolingo is eliminating 10% of its contractor positions as artificial intelligence takes on some of their work, according to Bloomberg.
  • Sharpie and Rubbermaid producer Newell Brands is cutting 7% of its office roles, The Wall Street Journal says, as part of an organizational realignment.
  • Ad tech firm VideoAmp is laying off 20% of its employees as its CEO steps down, AdAge writes.
  • Xerox plans to lay off 15% of its workforce as part of a transformation under new leadership, The Wall Street Journal reports.
  • Digital news startup The Messenger is cutting around two dozen employees in the face of low cash reserves, The New York Times writes.
  • Financial news network Cheddar has furloughed some workers due to “unforseen” factors, The New York Times reports.

Business Insider recently published a similar list with a bit more detail:

The full list of major US companies slashing staff this year, from Amazon to BlackRock

And there’s a site,, that tracks the process in real-time.

Yet another recession signal?

The question is whether these layoffs fall within the “normal background rate” or if the trend is breaking out and steepening. If the latter, things might snowball as laid-off workers cut back on spending, causing other workers to be let go, and so on, until the economy drops into recession (at which point the Fed panics and starts cutting interest rates and bailing out everyone in sight — you know the drill).

Combined with ongoing trouble in real estatemanufacturing, and consumer debt, the recent layoffs are at least another data point on the list of recessionary red flags.

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January 13th, 2024

Posted In: John Rubino Substack

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