Salesforce Lays Off 1% of Its Workforce, But Why?

By Ben McCarthy

Unfortunately, 2024 has kicked off with a similar theme to last year: sweeping layoffs across much of the technology industry. 

TechCrunch has reported over 23,000 layoffs in January alone from companies including Google, Microsoft, eBay, SAP, and now Salesforce.

Salesforce Lays Off 1% of Workforce

The Wall Street Journal reported on Friday, January 26 that Salesforce will be laying off 700 workers – that’s roughly 1% of their 70,000 global workforce. This is in addition to last January’s announcement that the company would be laying off 10% of employees (approximately 7,000). 

While last year’s layoffs were in response to “overhiring” during the pandemic (as confirmed by CEO & Co-Founder, Marc Benioff), there is as of yet no confirmation as to who will be laid off in this latest round.

The current state of the tech world seems to be in juxtaposition with these layoffs, as some stock market tech darlings are helping the S&P 500 to hit record highs; Meta, Alphabet, and Microsoft stock prices have all climbed to new heights, with Salesforce not far off. 

This does indeed beg the question: why are these layoffs happening? An interesting article by TechCrunch (Yes, the tech layoffs surge you are feeling is real) looks at data from and tries to form a conclusion. Potential reasons include wider economic factors, the removal of resources that may be replaced with AI, and cutting any bloat following the hiring boom of the pandemic.

All of these factors seem plausible; while stock market prices are at an all-time high, we are yet to see key quarterly earnings data from some of these tech leaders. This will give us some insight into the economic recovery, as well as the impact of early AI-enabled products such as Microsoft’s Copilot (Microsoft’s FY ‘24 Q2 earnings come out tomorrow). 

However, since Salesforce’s own Copilot products won’t be released until the end of February, it’s doubtful that these will have a significant impact on their financial year-end, which closes on Wednesday, January 31. 

What Does This Mean for the Salesforce Ecosystem? 

The fact that Salesforce is so tightly tied with the rest of its ecosystem doesn’t need an explanation. We’ve seen this play out over the past couple of years as Salesforce’s revenue growth has slowed and layoffs have occurred, which has in turn created an unstable job market. Unfortunately, this is probably the first time the Salesforce job market has ever been majorly affected. 

One of the more plausible reasons for this latest round of layoffs is Salesforce’s focus on “performance culture”, which was fleshed out in a recent Bloomberg article: Salesforce Signals the Golden Age of Cushy Tech Jobs Is Over. As with most other hardcore sales companies, performance of salespeople is constantly monitored. Bloomberg has reported that Salesforce performance improvement plans will be put in place a few months after not hitting the right numbers, as opposed to quarters

Final Thoughts

With all this in mind, I highly doubt that this fresh round of layoffs should cause any more concerns to Salesforce professionals. Although it’s important to bear in mind that, while layoffs have been fairly abundant over the past year within the ecosystem, they seem to be getting less frequent. 

With global inflation slowing and interest rate cuts on the horizon, economic recovery does seem to be around the corner, with AI pegged to fuel this next stage of growth. We will have to see for ourselves how this plays out over the next few months, especially as quarterly earnings are delivered, as well as more and more products being rolled out. 

The Author

Ben McCarthy

Ben is the Founder of Salesforce Ben. He also works as a Non-Exec Director & Advisor for various companies within the Salesforce Ecosystem.


    January 29, 2024 6:38 pm
    I get phone calls from salesforce sales agents on a monthly basis. The amount of redundancy of these phone calls is hilarious. I don't even know who my account manager is anymore.
    Noam Chomsky
    January 29, 2024 7:58 pm
    Wow. I think it’s really wrong. Unless you have concrete proof. To speculate it is down to performance. Just think if it isn’t and the impact it has on the people impacted. And why aren’t you talking about the performance of the CEO? He seems to have got some decisions pretty wrong if he misjudged hiring by 10% over the last year. Perhaps the guy just can’t run a large company to the standard required?
    Dev Solanki
    January 30, 2024 3:05 am
    Hi @ben as per my experience always new technology on boom . The reason is less professional & high demand. When professional increased as compression of demand, results comes as layoffs. This is not good news for salesforce professional because if main company will do again & again layoff This means you are not working with good technology.
    January 30, 2024 5:52 pm
    The only reason to pay attention to layoffs is to learn the lesson that all the flowery talk during interviews with HR folks is, to put it bluntly, BS. As a job candidate you should research your company, understand their industry, know and internalize their values, profess undying loyalty, and be ready to be laid off when the CEO decides he wants to juice the stock value or follow industry trends, etc.
    January 30, 2024 7:09 pm
    the tech industry laid off or eliminated 250,000 jobs last January this January we’ve lost 25,000 jobs so there’s that. As a tech industry (& Salesforce) veteran, I’ve been watching this go on for over 30 years and I think what all of y’all fail to acknowledge is that when the fiscal year ends companies & the executives, running them, take stock of what they’re working on, and where people are focused, and they reprioritize- that’s normal in business and it should be happening. There are layoffs. There’s also lots of jobs opening up - new jobs - different jobs- (these days. It’s all about AI, I remember when it was all about websites, then all about mobile, the years it was focused on the cloud…) that is progress.. why all the doom and gloom? Clickbait?

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