Singapore:

Meta, Facebook’s parent company, has announced it will lay off about 11,000 employees, or 13 percent of its global workforce. It is the first mass layoff exercise for the 18-year-old social media giant.

The Asia Pacific headquarters in Singapore was not spared. Media reports speculated that of an estimated 1,000 workers in Singapore, perhaps as many as 100 have been affected, the majority of whom are techies, including software engineers.

Based on 2021 Singapore Ministry of Manpower figures, about a quarter of the country’s 177,100 work pass holders or about 45,000 are from India. Employment card holders are the highest qualified foreign professionals allowed to work in the country and must earn a minimum of SGD 5,000 ($3,700) per month.

No doubt many of these are impacted not only by the Meta layoffs, but other layoffs in the technology sector as well.

Tech companies around the world and in Singapore, a major tech hub where many of the tech giants house their regional headquarters, are freezing to adoption or downsizing in the face of sluggish consumer spending, higher interest rates and inflation.

Singapore-based gaming and e-commerce powerhouse Sea Limited, the parent company of Garena (publisher of games like League of Legends and Free Fire) and Shopee, made two budget cuts in June and September and withdrew job openings. According to the company’s most recent annual report, Sea employed 67,300 employees at the end of 2021, doubling its workforce the previous year.

After a net loss of $931 million in the second quarter of this year, and amid rising borrowing costs and a slowing global economy, the company reduced its overseas footprint and peripheral operations with the goal of increasing profitability by expanding its position in its key markets and core products.

The company has not disclosed the number of layoffs, but job losses in Singapore and in its offices around the world are estimated to be in the hundreds.

“A lot happened last year that a lot of cheap capital in the market flooded the market (allowing companies to really grow at any cost,” Jessica Huang Pouleur, a partner at venture capital firm Openspace, told CNBC in June. “What happened was that people were hired very quickly. You have a problem; you just throw people at it. I think we’ll probably see more of it over the course of the next few months.”

Southeast Asian companies downsizing in mid-year include Singapore-based digital asset manager StashAway, which laid off 31 employees, or 14 percent of its workforce, and currency exchange Crypto.com, which laid off 260 employees, or 5 percent of its workforce. workforce in Singapore.

Meanwhile, Malaysian online shopping platform iPrice also cut 250 employees, or 25 percent of its workforce, and Indonesian education technology company Zenius laid off more than 200 workers.

In November, digital payments start-up Stripe and social media network Twitter were among the companies forced to cut jobs in their Singapore offices.

On November 3, Stripe announced it would cut its global workforce by 1,000, or 14 percent. After the job cuts, Stripe will have about 7,000 employees. Some jobs in Singapore were also affected.

A day later, Twitter laid off half of its global workforce or about 3,700 employees — a week after Elon Musk’s acquisition. Those in the Singapore office were also affected. Singapore’s Straits Times reported that those affected included personnel from the engineering, sales and marketing teams.

Start-ups in the region were particularly affected by a drop in venture capital funding this year. Funding in the region fell 7 percent to $36.3 billion in the first quarter of 2022 compared to the same quarter last year, according to a report from Crunchbase.

Many tech companies expanded rapidly during the COVID pandemic as much of the world stayed home and adopted habits that caused a spike in demand for online services. As consumer behavior began to normalize after the lockdowns, some of these habits have changed. This coupled with inflation and rising interest rates has put pressure on all tech companies. Some are calling the recent fall in share prices of major tech companies an overdue correction.

While technology revenue and jobs will be impacted in the near term and market volatility is likely for the foreseeable future, the technology industry is expected to continue to grow in the long term.

A recent article by consulting and recruiting specialist Mercer says demand for tech jobs and talent in Asia continues to outpace supply. The proof Mercer claims is in the starting salaries for computer graduates.

Comparing Mercer’s 2018 data and taking into account the time it generally takes for a cohort in most locations to complete an average degree, there is significant growth driven primarily by mass hiring in emerging technology markets such as Vietnam (up 59 percent) and as well as lower cities in China (up 22 percent).

In addition, economies across Asia are being digitized. According to a study by Google, Temasek Holdings and Bain & Co, the Internet economy in Southeast Asia is expected to double to $363 billion by 2025, beating the previous forecast of $300 billion.

The technology industry is always going through “periods of major adjustment and correction,” such as the “dot-com bubble” of the mid-1990s to early 2000s, Dr Natalie Pang told Channel NewsAsia. Dr. Pang is a principal investigator at the National University of Singapore’s Center for Trusted Internet and Community.

“Widespread adoption of technology in the workplace and home fueled significant industry growth during the last two years of the pandemic, but the post-pandemic era has highlighted the need for adaptation and correction,” she added. “In the case of the recent layoffs, I would say technology is in a major adjustment period.”