Layoffs, hiring, labor shortages in the technology market

General Motors believed it would receive more than 1 million job applications this year when it ramps up electric vehicle production. It revamped its recruiting platform, added a talent CRM app and chatbots to prepare for the deluge. But today, the automaker said it is implementing partial layoffs due to economic uncertainty.

In a second-quarter earnings call Tuesday, GM Chairman and CEO Mary Barra said the company is taking steps to control costs and cash flow, including “restricting hiring to critical needs in areas that support growth.”

On the same day GM announced the move, Shopify Inc. He said he faced a specific problem that caused 10% of his workforce, or about 1,000 employees, to be laid off.

The Ottawa-based e-commerce platform, which is expanding into the enterprise ERP market, has seen e-commerce spending increase during the pandemic.

The company is betting that this e-commerce boom will be sustainable. “Well, obviously the bet didn’t work,” Luttke said. The market is now returning to “roughly what pre-Covid data should be at this level”.

He added, “Ultimately, it was my call to make this bet, and I got it wrong. Now, we have to fix it.”

In HCM Economic pressures on

Nucleus Research analyst Trevor White said layoffs and hiring could ultimately influence the way managers make HR technology purchase decisions. With the hiring slowdown, applicant tracking, onboarding and hiring tech-focused vendors will take the biggest hit, he said.

“We see anybody in this division struggling,” White said.

The major HCM vendors offer enough HR services to meet many needs, and when companies look to cut costs, these smaller vendors “will be the first to go,” White said.

In February, Miami-based management consulting firm Hackett Group reported that HR technology spending will increase 9% this year, and talent management is in high demand. Demand for technology is growing as the workforce headcount shrinks slightly. The consulting firm says HR departments are turning to HR tools to automate some tasks to make up for staff shortages.

In a presentation at the Maker Technology Conference and Exhibition in March, GM said its talent acquisition workforce is not growing to handle the increased workloads. To help improve operations, it has turned to third-party HR technology to partially automate recruiting processes.

In addition to GM, another bellwether about what’s going on in the job market may come when Facebook parent company Meta reports its second-quarter earnings.

Patrick Thibodeau covers HCM and ERP technologies for TechTarget. He has worked in enterprise IT journalism for over two decades.

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