Will massive layoffs at Google, Microsoft affect Connecticut?

With Amazon, Google, Meta and Microsoft announcing major layoffs this month, unknown is whether the January swoon is a blip in the digital sector, or the start of an extended slump that will ripple through the larger U.S. economy including in Connecticut.

Connecticut has no major corporate office for Amazon, Apple, Google, Meta and Microsoft, the “Big Five” that dominate the tech sector. While Amazon is among Connecticut’s largest employers, those jobs are confined to fulfillment centers and Whole Foods Market locations whose success is pegged to consumer spending.

Apple has only a retail presence with 10 stores in Connecticut, while Microsoft has a downtown Hartford office with less than 10,000 square feet of space. 

But plenty of other major employers depend on a healthy digital economy and spending. Norwalk has a significant cluster all its own, from ASML just over the Wilton line which employs more than 2,500 people making the machines used to manufacture semiconductors and flat-panel displays; to Datto, a data backup and digital security provider; to broadband giant Frontier; to Xerox, which has its headquarters in Norwalk and its Connecticut Business Systems subsidiary based in Wethersfield.

Speaking in November, the CEO of ASML said that while the company expected “near-term uncertainties” it was pushing ahead with a major global expansion on confidence in the long-term outlook, in part due to the United States reinvesting in domestic chip production with the goal of technological “sovereignty” in ASML’s words to wean itself off a dependence on Taiwan for chips. ASML listed 160 openings in Wilton as of Friday, a number of them posted within the past few days.

Connecticut also has a number of consulting firms large and small that focus on information-technology strategy, systems installation and outsource management, to include Infosys in Hartford which has more than 300,000 employees globally.

Infosys has not reported any mass layoffs in the recent spate, though TimesNow in India where Infosys has its headquarters reported recently that hiring among the biggest outsourcing companies there has dropped to the lowest level in three years. In Connecticut, Infosys listed less than 30 openings statewide as of Friday spanning offices or client sites in Hartford, East Hartford, Stamford and Groton.

Between consultants and companies that employ IT staff in house, the Connecticut Department of Labor projects the state adding nearly 8,800 jobs in the information technology sector by 2030, pushing the total to more than 61,000 for a 17 percent increase from 2020.

During the 2001 internet bubble and the short recession that followed, unemployment in Connecticut peaked at 5.3 percent, well below the unemployment rate after the Great Recession when financial markets collapsed as a result of runaway mortgage lending.

As of November, Connecticut unemployment stood at 4.2 percent, according to the Connecticut Department of Labor, with an update scheduled on Monday. Through the first week of January, DOL had not tracked any spike in initial claims for unemployment compensation in the broad industries it tracks that include elements of technology and information services.

Any number of Connecticut commuters work for tech companies in New York, whether in Manhattan offices or IBM in the lower Hudson River valley. Big Blue has a big Southbury campus with more than 1,000 workers at last report, some of them external contractors. IBM did not respond immediately Friday to provide an update on the Southbury workforce.

Hundreds of other Connecticut companies generate a majority of revenue through ecommerce, from travel giant Booking Holdings and its Priceline subsidiary based in Norwalk, to MetaRetail across town which operates its own online sales fulfillment center in Stratford.

Not since February 2021 has any Connecticut employer in the digital economy filed a mass layoff notice under the guidelines of the Workforce Adjustment and Retraining Act, when the IT-support systems company Pomeroy Technologies reported cutting more than two dozen Connecticut jobs after losing a contract.

A clearer picture could emerge in the coming few weeks during the wheelhouse of corporate earnings, to include Stamford-based Charter Communications, Intel and Apple, the lone company in the Big Five that has not reported a mass layoff in recent weeks.

Includes prior reporting by Dan Haar, Luther Turmelle and Paul Schott.

Alex.Soule@scni.com; 203-842-2545; @casoulman


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