Navigating Tech Layoffs: Brook Taube Challenges the Need and Explores Alternatives

Jul 26, 2023 9:00 PM ET


Brook Taube, an internationally recognized industry leader and founder of billion-dollar companies, asks a simple question. In the rising tide of layoffs, especially across the technology sector, inevitable? or are they avoidable–are they really needed at all?

In addressing that question, Taube operates from a unique perspective. He believes that a company is as much its people as its product. 

Layoffs carry well-known but unintended consequences for employees. Nevertheless, companies increasingly turn to layoffs as a survival tool when the overall economy is trending downward, inflationary pressures are increasing, interest rates are rising, and recession fears are circulating among entrepreneurs. Layoffs, in this setting, are intended to cut the cost of salaries and benefits in the face of lean revenues and falling profits.

By the Numbers

On March 1, 2013, the Bureau of Labor Statistics (BLS) in the United States cut its budget and eliminated (among other functions) its Mass Layoff Statistics program. This made layoff statistics more difficult to acquire, and it made forecasting less certain.

However, according to data now compiled by the statistical analyst,, 662 tech companies reported layoffs in the first quarter of 2023, amassing a running total of 192,334 employees out of work. For all of 2022, stats show that 1056 tech companies laid off 164,591 employees. So, if the 2023 rate continues, the tech industry could bleed more than 900,000 jobs by 2024, about a 5-fold increase over ‘22. Taube’s warning that the tech industry should brace for trouble appears reasonable.

The Personal Side

Among his fiscal interests, Taube has engaged strategically with early-stage technology companies. He was also an early sponsor of Progressive Therapeutics Inc. (, whose global mission is to improve mental wellness for millions of people. This interesting linkage highlighted his view of the tech layoff spike through a mental wellness lens. With the critical human factors in view, along with the economic factors, Taube now asks, “Are layoffs really needed in the tech industry?”

Protecting Long-Term Prospects

While the pandemic sparked sudden, unexpected growth in tech employment, with probable over-hiring, a subsequent cooling in the industry will not mean the demand will disappear for skilled, seasoned tech industry employees. Though concerns about the global economy remain, analysts still project enterprise technology spending to reach as high as $4.5 trillion in 2023, up nearly 2.5% from 2022.

With the U.S. tech market accounting for as much as 35% of the total world market, opportunities for continued growth remain strong.

As a result, layoffs risk the loss of talent and experience that companies may find hard to recapture in the near or distant future. Layoffs, then, according to Taube, may yield short-term gains and short-term investor gratification but can endanger future growth, longer-term stability, and profits.

Layoffs, Taube now warns, may not only be unneeded but fiscally unwise.


“There are many other ways in which organizations can cut costs without laying off employees,” Taube says. He promotes a number of alternatives to unneeded layoffs, not only with human costs in view but also as a critical investment in future profitability.

Employment security that retains valuable workers can, in many cases, save as much as layoffs and sometimes more. These alternatives include time-off options, work reduction options, and safe exit ramps.

Among the time-off options are specified-length furloughs and short-term sabbaticals. While these are unpaid, they offer the security of a guaranteed return-to-work, often by a specific date.

Work reduction options include temporary pay cuts, work-hour cuts, a promotion freeze, an annual raise freeze, or zero-hour scheduling. While potentially costly to an employee, these options can retain jobs for workers while cutting overall business costs. 


If some layoffs are unavoidable, Brook Taube advises the creation of a soft off-ramp. This requires contingency planning by the company–an investment in layoff preparation. This was an especially important project for tech industry leaders who predicted volatility in their market.

Outplacement assistance is a career program designed for laid-off employees. Such programs assist in resume creation, offer coaching for job interviews, promote networking within the tech industry sector for which they are trained, navigation of job boards and internet sites, and employment agencies–all of which will help a laid-off employee land the right job. The benefits to the company include retaining in-house morale, public confidence, and brand reputation.

Employers may also simply encourage quitting. According to the U.S. Department of Labor, workers who leave their jobs voluntarily overwhelmingly find new positions and generally at higher salaries. New tech startups are especially drawn to attracting laid-off workers who have long-term experience.

Employers seeking alternatives to layoffs can also direct workers to the U.S. Labor Department’s Rapid Response Services For Workers ( This service works to customize services and resources to the specific needs of a laid-off worker.

Are Layoffs Needed?

Brook Taube, whose strategies have piloted industry leaders to high profits for decades, now assures the tech industry that layoffs are not (always) necessary.

Layoffs are not a panacea for reducing costs in times of economic uncertainty. They can generate bad publicity, lower morale, increase anxiety and/or reduce trust, and potentially lower innovation.

“When companies don’t know or ignore these consequences, one thing is clear,” concludes Taube. “Layoffs have a profound effect on the livelihoods of employees in the short term, potentially with limited benefit, and likely create consequences to the business over the longer term.”

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