Mass tech layoffs signal expansion of the reserve army of labor

Most people in tune with tech news are aware that layoffs have recently hit the tech industry hard. What most are not aware of, however, is that such layoffs are a pre-planned measure between hedge fund managers and companies to increase their profit margins. Recently, some have been made aware of a letter sent by Christopher Hohn, of TCI Fund Management, to Sundar Pichai, CEO of Google. The letter, in a few paragraphs, outlines that the plan is to “reduce headcount” and “address excessive employee compensation”. As many of the layoffs will affect fields of importance, the endgame is clear: fire many, to hire a few again at a lower price, thus, reducing the overall pay-grade.

This manoeuvre is a classic one, and, to marxist economic theory, is understood as the concept of the reserve army of labor, which refers to the pool of unemployed workers who can be called upon during periods of increased demand, thereby allowing for a flexible and exploitable workforce which directly reflects market fluctuation. In the case of skilled fields, the initial steps to such measures are enacted in the form of specialised education, such as boot camps and courses, that, in our specific field, creates qualified “code monkeys” that stitch existing infrastructure together. Those then form the initial reserve army of labor, that is then brought in with small waves of layoffs, and are given salaries way below the pay grade of the previous worker who took their place. This initial stage, which doesn’t create much unrest in the workforce (as the new workers who come in are seen as deserving the lower pay), serves as the foundation for subsequent layoffs and replacements, up until the point where the median pay has fallen significantly.

One of the major reasons such layoffs are possible in the first place is because of the lack of penetration of the workers’ movement in the tech field. This, combined with the reactionary tendencies of the middle-class, which dominates the technology field, dooms the movement. The penetration of petty-bourgeois individualism has been more thorough in the technology field than it has been in other fields, and it shows. Tech workers think of themselves as separate from the rest of the working class, seeing themselves as the “forefront of progress” (for whom?) and looking down upon all other fields of endeavour which they see as lowly and unproductive.

On the factory floor, there will always be hostility between the technician and the machine operator because the technician sees the operator as an obstacle to what they perceive to be their own class interest. Here, as Marx outlined, the division of labor acts not only as a fact of class society and a logistical reality within the firm, but as a powerful ideological tool to contain unrest via internal competition. This, combined with the predisposition of this strata of wage laborers to reactionary action, and the preservation of a social order where they see themselves as the deserving of survival, today spells the doom of any class movement arising within the technology workers.