This is likely going to be a trend from this point on – there will be more layoffs than furloughs because this is no longer a short-term event to muddle through but a large-scale destruction of demand. About 54% of US chief executives say they plan to lay off or furlough workers, according to a survey by The Conference Board. And 43% of those surveyed say they plan to reduce wages, salaries, and benefits. GE is looking at laying off its aviation staff and Volkswagen has shuttered its facility in Chattanooga indefinitely. As unfathomable as job losses have been in the past few weeks, they are only getting started.
But in Silicon Valley, layoffs over furloughs are already the reality for a lot of people. It’s going to have an interesting impact on Bay Area real estate and California’s government revenues.
From the Mercury News: “An estimated 18 percent of employers surveyed by the Silicon Valley Leadership Group responded that they had either gotten to the point where they must undertake layoffs, or they were contemplating job cuts.”
But if you work for a venture-capital funded company, layoffs instead of furloughs are a near certainty. This is a big deal for the American economy, because tech start-ups employ several million people on their own and they have a tight-knit group of people driving investment in that sector.