Tech layoffs: empathy for your boss

Ring in 2026 with a stiff shot of the least 2026 thing humanly possible: empathy for the other side. In this article, we articulate the managerial thinking behind our present hell's layoff firestorm.

This news again?

Like the poison fruit enveloping a corrupted seed, every corporate layoff announcement falls to earth encased in toxic nutrients that nourish a foul (but thin) narrative from the insipid truth: the bosses who laid you off cannot create permanence. No leader can.

When asked to explain themselves, company press releases and generic journalism read rich, with full-fat rationalization meant to deflect, gaslight, and bamboozle reasonable people. "Why'd we do it? Well, because…"

• Efficiency from AI
• Workers have outdated skills
• Flattening org charts so we can act faster
• Individuals can take on ever-higher workloads
• COVID-era binge hiring
• Tariffs and trade relationships
• Bureaucratic layers water down ideas and impacts

If you zone out before you finish PR's euphemism recitation—that's the idea. Right down the memory hole!

Worse, just as a ripe pomegranate's sweet taste bribes animals to carry its seeds away to new locations, AI narratives induce journalists and pearl clutchers alike to blazon win-win AI layoff stories to the top of the public consciousness. These nothingburgers use a simple recipe: invoke the perpetrating company's recognizable brand, staple it to puffwords about AI, finish with the aspiring herald's hopeful by-line and publish. AI bad captures outrage clicks, AI good spurs share price growth. Mmmm, disgusting.

Other papers characterize layoffs as revenge, with vindictive, moustache-twirling bosses twisting their bootheels into the necks of uppity job-hopping ingrates.

Exactly none of this otiose pandering unpacks the minds or contexts of the people deciding upon and executing layoffs both newsworthy and mundane. Borrowing AI's favorite 1-2 sentence structure and punctuation: these people—your bosses—aren't uniformly evil or short-sighted. They're complex humans blocked by and subjected to capricious uncertainty.

Your authors have been everyone in the business hierarchy:

• Ignorant zit-faced interns
• Essential front-line ICs
• Expendable middle managers
• Pressure-cooked senior leaders
• Capitalist swine owners

We've been laid off (and certainly fired!). We've advocated for and against layoffs. We've ordered them when we shouldn't have, and we've failed to perform them when we should have. Business constantly challenges one's ideals. Its necessary and unnecessary cruelties age you like a president.

Being laid off knocks you flat and flushes your self-worth straight down the toilet. Then you receive an Amazon Prime drone-delivered box of 99% pure anxiety, every "what-if" and "should have" billowing a black pall of doubt over your imagined future. No matter your executioner's stated reason, the soft banishment of a job loss is the most personal thing in the world.

We wrote this piece to unpack the logic, pressures, and contexts of the bosses ordering layoffs. Managerial and employee pettiness, brutality, and politicking lie beyond the scope of this explainer. We aim to increase understanding and don't expect understanding to change how anyone feels.

Business leaders and entrepreneurs have now spent 10 years managing through a chaotic whipsaw environment. Yes, the Great Recession savaged markets and permanently chilled GDP growth, labor force participation, and household net worth while temporarily icing general demand in most sectors. However, weakness isn't chaos, and after the post-WWII economic consensus and cultural certainty truly died around 2015–2016, the mindbending chaos of modern American business sank in.

Your bosses simply don't know what the shape of their business will look like in two years. Some pretend to, and some make wild claims to, but their perspectives are every bit as subject to exogenous shock conditioning as yours is. On top of that, increased organizational responsibility renders people more susceptible to motivated reasoning and wishful thinking. As you climb the ladder, the answers and directions you need get murkier and more contradictory, helping desire shove reason aside when the situation's fraught, as it most certainly is.

Like anyone in 2026, bosses find comfort in pessimism, too. The pro case for current-state AI is a sort of optimist's pessimism: hypothetical task automation unlocks a better future with increased revenues and profits without such high and tumultuous staff cost. However, if that future doesn't materialize, the demand and growth pictures look dim, so the business won't need all these people, anyway. The hedge only fails if a. the economy continues zombie shuffling forward and b. AI doesn't deliver.

Shocks keep coming. A modern manager's crisis response mechanisms have now become behavioral, if not autonomic. Instead of salivating like Pavlov's dog, managers take evasive action to survive another fiscal quarter.

Why do bosses make layoffs?

While laid-off workers may picture steepling, villainous senior executives sharing a good laugh about canning so-and-so to fund their 49th Rolex, that particular vilification doesn't reflect reality. Instead, layoffs are secondarily about money. They're primarily about gaining the leverage needed to overcome some strategic challenge present in today's chaos economy:

Org structure incompatible with the future. Honestly the most common reason for layoffs. Senior managers need to change course, adjusting the company's composition to address some existential demand or efficiency challenge. Almost by definition, the teams (and tools) they have aren't what they need—picture yourself staring at a bolt loose in a threaded hole while you're holding a hammer. The restructuring will continue until it feels right.

Shifting sands, popping bubbles. In 2023 Porsche stood astride the automotive world, basking in fawning praise from simping reviewers while raking in beaucoup profits. By 2025, Porsche found itself on death's door due to grievous miscalculations in future Chinese demand, U.S. appetites for EVs, and price intolerance in Western markets. Putting all obvious consequences, blame, and recriminations aside, how should Porsche's new managers handle a rug-pull like that?

Changing general demand. On a monetary basis, American consumption continues to increase. However, fewer and fewer people power that consumption, with the top 10% of earners driving it. Also, by 2030, deaths will exceed births in the U.S., refocusing investment in and demand for services needed by older people. Even technologies like weight loss drugs shift buying behavior, threatening to upend entire industries. To survive, many businesses need to abandon their efficiency posture and adopt an exploratory approach, and that takes operating margin.

Margin maintenance. Here's a wacky one: a business can succeed over a given fiscal period and still make layoffs! Hitting the margins investors demand perversely requires corporate senior managers cut heads (and everything else) to maintain the on-paper appearance of profit margin. Once again, it's not about the actual money, it's about optics. If you want to feel like pond scum, be the manager ordered to orchestrate a $3M Thanos snap for appearances' sake.

Geopolitics. The collapsing world order forces managers to move (and shutter) factories, change staff, endure supply chain disruptions, and perform bizarre acrobatics just to stay in business. For example, computer graphics card manufacturer Sparkle set up a production facility in Taiwan specifically to avoid tariffs on GPUs that were previously Chinese manufactured. We doubt they relocated the Chinese workers displaced by this move—it's not sensible (or possible), so they were laid off.

Plain old mistakes. There's ample room for cockups in chaotic times. See all the journalism about pandemic-era overhiring for endless examples of assumptions that failed.

Look at that list again to appreciate its gravity. Except for some mistakes, company VPs and officers can't control anything here, but must instead adapt to them. Each listed shock could happen to a business multiple times in just one year. Painful exogenous shock therapy for leaders and owners, ugly force majeure on employment relationships.

How layoffs help businesses

When facing uncertainty, all people reach for one of three things: flexibility, flexibility, or flexibility. While "restructuring" and similar euphemisms describe an organization's realignment toward an objective, they don't explain exactly how that business regains its options and opportunity. Layoffs increase business flexibility through the following mechanisms:

Financial padding. Obviously layoffs free working capital, and that available cash helps businesses cheat death. Somewhat tragically, basic math shows that laying off normal workers saves far more money over a given period than cutting executive compensation.

Converting liabilities into assets. Here's the real money shot: layoffs help businesses limit the outflow of disappearing cash. An old manufacturing adage states that "When you pay a wage, the worker walks away with that money forever. When you buy a machine, that cash stays yours, and the machine's either productive, depreciable, and/or sellable." Equipment isn't always readily liquid, but it's far more liquid than paid wages you'll never claw back.

Dismantling specialist support structures. We'll use tech as our example here. In many orgs, a senior iOS dev works atop a platform constructed of BAs, designers, product people, QA, DevOps, product licenses, and infrastructure galore. That's an epic amount of fertilizer and tending to stand up and then extract value from one high-expertise diva. The code-creation supply chain became hideously expensive. When flexibility's paramount, investing in legions of largely inflexible specialists suddenly looks wildly dangerous.

Value if solved. Executive management trick for you. Take the top 50 emails off your inbox and treat them like rows in a spreadsheet. Start at the top. If the problem contained in that email were instantly solved by some organizational 50-wish business genie (lets call him Genie Wickman), does that grant your business high, medium, or low value? Chances are maybe 2 in 50 are truly fate-altering, high value issues. Realizing that, senior managers select for people who help deliver against big worthwhile challenges, letting irrelevancies and nice-to-haves burn and laying off the staff attached to them.

Cutting anchors. Sometimes business units, product lines, departments, and specific staff add more drag than they're worth. We hope for nuance, but it's drastically simpler to cut the rope and disconnect a problem department than it is to solve said problem or sort through every department member's specific merits and potential future contributions.

Note that the quest for flexibility doesn't always pan out. Klarna FAFO'd on AI-motivated layoffs only to come crawling back to meatverse humans.

Which individuals get laid off?

Typically, when we chat with someone who's been laid off, we hear resentment that they weren't protected. Protection should've come from their expertise, seniority, recent wins, or some patron or other connection, they say. Unfortunately, layoff protection only comes in one flavor: future utility. Here's how bosses perceive prospective staff and teams' layoff potential:

Overpriced institutional experts. Keeping you too might simply be too expensive. We can lose you or lose three other people. Who's better to lose for our future?

Over-specialized focusers. As long as your specialty pays the bills, you're good. If things change you're the very first to go. Over-specialized too often means "doesn't understand the business and can't help us advance".

Nice-to-have seniors. You've all seen this pattern: as experts gain seniority, they drift away from customers, dealmaking, and business fundamentals. A Senior Principal Fellow who can pick and choose their work ultimately picks low-value, high-meaning work, falling into a mentorship- or stewardship- only role. Unfortunately, when you step out of core production or revenue generation tasks, you're in danger. Right when you feel you're at your most powerful and fulfilled, you're actually at your most vulnerable—you forsook survival work for optimization tasks.

Org chart Minesweeper victims. Like trimming fat off meat, bosses cut around their key staff. Laying off some people has no effect, laying off others stops the whole system. What does the hole look like when they're gone? Deciders make that judgment based on what a staff member will do in the future, not what they have done to date. If your team includes people you're certain are safe from any potential layoff, that's usually the signal that you're the unsafe one.

Acolytes of the old god. Some employees represent the old ways and must be sacrificed. Embodiments of the old system, heretics from the previous church. In similar fashion to the nice-to-have seniors, qualities once valued become liabilities come layoff time. The "figure-it-out guy" never becomes the "scaling guy" and usually finds themselves a bottleneck. "He's not a $5B org guy, not a seat for him in our future." Goes doubly so for former changemakers—pioneers crushed by the golem they brought to life. "I burn my life for a sunrise I'll never see."

Best efforters. Like earnest children, some people put in their best and it's just obviously not good enough for the business. We recently heard an owner tell an employee "I like you, but if this is truly your best work, you're fired."

Sometimes employees defend their roles with the following epitaphs:

• "My job is just supposed to be _____."
• "I don't talk to customers."
• "I support the people who do the work."
• "I have X years, Y credentials, and Z experiences."

If you regularly say any of the above, beware. In chaos, businesses need people who can stand against the unknown, succeed each other if someone goes down, solve challenges across disciplines, and glue handles onto intractable problems, all with less specialist in-churn and out-churn.

While the training that never seems to happen plays a big role here, so does innate talent. Sounds harsh, but on the bright side, it's a welcome shift away from documented skills and credentials and toward palpable accomplishment. Clever, talented generalists are back!

For those who remain

After a massive layoff, those left now have to overcome the challenge that prompted the layoff while themselves feeling less stable. Remaining staff tend to suffer a temporary 20% job performance hit and 40% reduction in job satisfaction. The system has to heal.

Empathy for your boss means understanding the nature of the business that employs you both. Build your capacity for empathy by putting in the effort—go understand the chaos your organization faces and the forces your revenue and product teams feel. Having been a boss yourself helps as well.

While we cast our collective side-eye upon the purported impact of AI on the job market, don't become an AI-replaceable specialized production insect. Businesses need the ability to stop and start roles and activities instead of firing and rehiring role players.

Ironically, only staff add defensive depth to the organization under constant threat. Misplaced capital investments rot away in the back room or get sold off during receivership. Bigger brains means a better chance of adapting to a world outside your control.

Flexibility's a necessity when facing uncertainty. If you're caught in a software problem, contact Next Mile to improve your odds.