Salesforce will pause all hiring in technology and product divisions, including in its chat subsidiary Slack, according to a message from Ross Harmes, chief of staff to the Slack CTO, seen by Fortune.
The memo’s characterization of an extensive hiring pause was disputed by Salesforce, which told Fortune that the company was “not freezing hiring in any departments,” and said it would continue “strategic hiring.”
Salesforce did not dispute the authenticity of the memo, which was shared internally on Tuesday amid a climate of broad uncertainty within the tech sector. On Wednesday, Twitch, the livestreaming giant owned by Amazon, announced plans to layoff 500 workers, and there were reports of layoffs in other Amazon businesses.
“This isn’t our first rodeo with hiring pauses, but it’s definitely disruptive and will affect our plans in Q1 and beyond,” Harmes wrote in the memo. “Remember, we won’t ask you to do the same amount of work with fewer people, so adjust plans accordingly.”
While Salesforce had a hiring freeze last year from October 2022 to January 2023, this hiring freeze doesn’t have an anticipated end date, according to the memo. The freeze will be lifted “based on how the numbers are looking each quarter, I would assume at least a quarter,” Harmes wrote. All written and verbal offers already out will be honored, the memo added.
“Headcount that you currently have isn’t going away, it’s just being delayed,” Harmes wrote. “We’ll maintain the list of open roles, and continue to add to it when people leave.”
A spokesperson for Salesforce told Fortune that the firm has “made rapid progress on our hiring goals in technology and product to support strategic growth areas like AI,” adding that “we are continuing strategic hiring to meet the needs of our business. We are not freezing hiring in any departments.”
Salesforce went on a hiring spree just a few months ago, hiring 3,300 people across various departments, Bloomberg reported. Just one year ago, in January 2023, the firm laid off 10% of its staff after hasty pandemic hiring followed by an economic downturn.
“Our job is to grow the company and to continue to achieve great margins,” Benioff told Bloomberg in an interview at the time. “We know we have to hire thousands of people.”
Layoffs and pauses seem to be making an unfortunate comeback in the new year. The announcement of Salesforce and Slack’s hiring pause coincides with significant reductions in Amazon’s Twitch and Prime Video divisions, where there are plans for a 35% reduction in staff and several hundred cuts, respectively. There’s also Humane, the AI pin startup which raised over $200 million and plans to ship its new hardware in the coming months, which laid off four percent of employees this week in a cost-cutting measure.
The slowdown in hiring at Salesforce comes as a surprise to some, especially after Salesforce CEO Marc Benioff extended job offers to OpenAI employees in November, promising to match their current salaries after the temporary removal of OpenAI’s CEO, Sam Altman.
“The good news is that we’ve made a ton of hires over the last six months. The bad news is that managers with open roles will feel the pain for a while with understaffed teams,” Harmes wrote.
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