Without a doubt, things are tough for everyone right now. Inflation, war and the economic situation are not helping everything to go as it should and this is weighing heavily on businesses and for the first time in more than two decades it is also having a negative impact on workers. in the IT and Internet hardware sector. And it is that in the month of July alone there are more than 32,000 new unemployed by the top 200 companies in the sector. What are the reasons?
Well, there are several, really many and very diverse, but everything can be summed up in one word: losses. What in 2020 was a boom in demand has now turned out to be the opposite, as whatever goes up must come down and as usual the first affected to experience it first hand are the workers.
PC makers and internet companies are putting a lot of people out of work
Layoffs and more layoffs. This is what brings all this international context and where also the trend is not going to decrease apparently. Moor Insight and Strategy Under his chief analyst leaves really alarming data with figures like the one named above, where Google and meta It seems that they are on the podium, but not only them.
In economic terms, where these companies are protected, PRIVATE lost in the second quarter of this year between 10 and 11 million dollars with downward forecasts for the rest of the year. Other companies that are struggling to sell with the most direct competition in different strata such as NZXT or ASUS they have already been laying off staff for more than a week in the face of the defeatist economic outlook.
But many have already made a move soon after the pandemic entered, being foresighted about the downfall they have suffered. For example, we know the case of EKWBwho had to lay off more than 60 employees out of 200 they had because the income fell by more than 25% in a few months.
A bleak future, falling sales and rising prices
As is the case in the automotive sector, the decline in sales must increase the price of the product to mitigate the deficit. This is precisely what we are currently seeing in the PC and Internet hardware sector, whether servers or services: drop in sales of more than 20%worse still are the expectations and the stocks which, in many companies, are almost full.
Many believed that collecting materials to create products and be able to sell them was the right strategy, so They paid for everything in gold for rarity. Now demand has crashed and scores need to be settled, so if you’re selling less the solution is to raise the price of what you’re selling to try to soften the blow.
The worst part is that this scenario is not short term. Analysts are predicting tough times even for the end of next year as the market, its supply and demand need to come back into balance and from there start making realistic estimates with the supply chain. A difficult time for the sector, where the rest of the industry seems to understand what is happening in desktops and servers with the PC companies, so it is more than likely that many end up unemployed.