Layoffs are no longer a rare event in big tech — they’re a feature of the operating model. But constant, rolling cuts come at a cost: eroding culture, killing innovation, and triggering chronic fear among employees. In this post, I explore the psychological toll of repeated layoffs, the long-term risk to morale and trust, and what tech leaders must do differently if they want to retain their best people and preserve the soul of their companies.
There’s a quiet shift happening in big tech — a cultural erosion that’s accelerating with each round of layoffs. Once rare and publicly agonized over, layoffs have become a routine cost lever for some of the world’s most admired companies. You see it at Microsoft, Amazon, Salesforce, Meta, Cisco — and it’s no longer a shock. It’s become part of the operating playbook.
But let’s be honest: these aren’t always driven by existential threats or sweeping strategic shifts. Increasingly, they feel opportunistic, pressured to hit margin targets or appease investors. You feel it on the inside: reorgs with no clear rationale, vague “realignment” language, spreadsheets quietly passed between HR and finance. The models are blind to loyalty, tenure, or awards. The spreadsheet decides, not your VP.
I say this with empathy, not bitterness. I spent nearly two decades at Microsoft. I joined when we still considered tech a calling. I left in 2013, on my own terms — but it took years to unwind how deeply that identity had taken root. I still love the company. But I see it more clearly now: these companies are not families. You are not “a Microsoftie” or “an Amazonian” for life. You’re a line item. And at some point, that row may be deleted.
When layoffs become routine — even expected — employees don’t just worry. They adapt. They manage up. They play it safe. They compete instead of collaborating. Psychological safety erodes. People stop mentoring, stop raising their hands, stop challenging bad ideas. Instead of building a product, they build personas. Instead of honest retros, you get PowerPoint theater.
Cisco became infamous for this — employees anticipating cuts like clockwork each fiscal Q4. That same culture is now metastasizing elsewhere. Microsoft’s recent layoffs, while often modest in scope, have become disturbingly frequent. And that constancy is corrosive. Not every cut is damaging. But perpetual cuts fundamentally change how people behave.
It creates a hierarchy of fear. Everyone becomes a potential target. Everyone knows someone who was let go despite stellar performance. The message is clear: no one is safe. That’s not an execution issue — that’s a values problem.
To the leaders making these calls — the CHROs, CFOs, and operating execs — let’s be real: rolling layoffs are doing more damage than you think.
Today, Microsoft announced yet another round of cuts. Not massive, but enough to make headlines — and worse, enough to spike anxiety across the org. When layoffs come in waves, quietly, every few weeks or quarters, they create a kind of ambient dread. Like thunder in the distance that never stops rumbling.
This slow, rolling approach is the worst of both worlds. You don’t get credit from Wall Street for a bold reset, and you slowly erode the confidence of your employees — the ones you say you’re trying to retain.
Here’s what really happens when you drip layoffs over time:
If your goal is to create a high-performance culture, this is not the path. You’re not optimizing the org — you’re destabilizing it.
What You Should Do Instead:
The long-term health of your company doesn’t depend on a 1% headcount trim. It depends on whether your best people still believe in what you’re building — and whether they think they’ll still have a place in building it next quarter.
After a layoff, it’s tempting to jump to the next big name. It’s familiar ground. The compensation is excellent. The work might be good.
But pause and ask yourself:
Layoffs don’t just hit your paycheck. They hit your nervous system.
Your amygdala, the brain’s alarm bell, kicks in. It’s wired to detect existential threats — and in many ways, that’s how your brain experiences job loss. As exile. As risk. As shame.
That’s why people spiral. That’s why insomnia, fear, anxiety, and paralysis often persist weeks or months after. This isn’t weakness — it’s wiring.
But it can be rewired.
If you’re still inside, watching the next wave build: don’t let fear define you. Stay generous. Stay grounded. Keep building. Support your team. Culture is contagious — and you can be part of the antidote.
If you’ve just been let go: you are not your badge. You are not your title. You are not the row on someone else’s spreadsheet. You will bounce back — and if you’re intentional about it, you might even build something better.
Layoff culture may be the new normal — but we don’t have to lose our humanity with our headcount.
