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The encryption is crashing. Now, the wider tech department is also losing its brilliance

Canada's technology sector has grown rapidly in recent years as domestic start-ups and foreign giants have embarked on the hiring of hundreds of thousands of highly educated and talented workers. doing. However, its expansion has been slowing down lately as much optimism has been lost from this sector due to high inflation, rising interest rates and a slump in cryptocurrencies.

Chris Alvinson, CEO of Waterloo-based incubator Communitech, has suspicious fundamentals. A "going to the moon" company suddenly found himself and withdrew in the United States. It says it will be more prominent and cannot adapt to the new reality.

Canadian high-tech companies are, generally speaking, much better at managing capital, so they are doing relatively well at this point, but that doesn't mean they aren't worried. ..

"There is a founder who was 18 at the time of the last recession," he told CBC News. "It will stress the system, but I think it will be much more powerful in the end."

Meta, Amazon, Apple, Netflix and other high-tech giants It has risen in recent weeks, and once there was a fierce war overtalent, it has implemented many high-tech giant employment freezes and reduced staff.

US streaming giant Netflix announced on Thursday that it would cut another 300 jobs. This is the second time in a few months that we have announced a layoff of the same size.

Cloud source websitelayoffs.fyihas recorded over 20,000 technician losses in the last two months alone, mainly in major markets such as Seattle and San Francisco. It takes place in and around the US technology hub.

Reductions in Canada are not so dramatic, but they are happening.

Canadian financial technology unicorn Wealthsimple last week fired 13% of its staff, citing an "unprecedented" level of variability in explaining the reduction of positions for about 160 people. rice field. "Many of our clients live in an era of market uncertainty they've never experienced," CEO and founderMichael Katchen told staff when announcing the news.

Silver lining

Jacqueline Au was one of the people who was relinquished from their Toronto-based business. She suspected something was happening when she realized earlier this year that her company began to reduce spending on marketing, her department. "When that happens. It's natural for the team to think about what would happen to my job if we didn't spend marketing money."

Fired for the first time Is , and while saying is uncomfortable, he enjoys his vacation to think about his next career move. She said she enjoys the technology sector, but she knows more headcount reductions will come, so she will choose who to sign next.

"I think this is just the beginning. I think the industry needs to keep losing fat to be floating," she told CBC News. "I think there are ups and downs, but winter stays here."

Sumeru Chatterjee recently went to Vancouver He lost his job at a technology company based and then turned his attention to helping other technology workers network with each other. .. (Dillon Hodgin / CBC)

Vancouver-based Thinkific fired about 20% of its staff in April, and Sumeru Chatterjee I was alone. About 100 people will let go. Chatterjee is from India, she came to the United States to attend college, and she had various technical positions for about 10 years before she made the leap to Canada in 2020.

"Last year, the general sentiment of the industry as a whole. We needed to grow, so we need to rapidly expand our market lead to hire more people," he said. I told CBC News. "So the layoff was like a dramatic change in the event."

He took the cash of venture capital to gain market share without worrying about profits etc. The exhaustion states that the technology sector has grown very rapidly over the last decade. "The usual business indicators such as profitability and cash flow were mostly disliked. Many people need some fundamentals like profitability if they want to run a business. I think you're awake. Businesses and customers who pay you. "

'Survive for you to prosper'

Tens of thousands of people from over 100 countries Feelings from the stage of a clash conference in Toronto where technology enthusiasts gathered This week was not shy and positive to discuss everything digital directly. However, bystander had a whisper of bursting bubbles .

Deena Shakir is a partner of Venture Capital Lux investing in technology companies. (CBC)

"Anyone who is currently innovating or investing in technology or startups will understand exactly what is happening at this moment. I'm trying, "said Deena Shakir. She is a partner of Lux Capital, a venture capital company based in Silicon Valley. "We are the topic of all partner meetings, and all lunch and coffee conversations."

She is pushing back the idea that the high-tech sector is returning to the bubble, but obviously One of the things that is bursting is expecting infinite growth at the expense of profitability. That's a good thing, she says.

"We have advised. Our company is trying to think in the long run to make sure we have enough capital reserves to survive this storm. "She said. "Surviving so that you can prosper is an important idea to think about."

Survival is important in the field of cryptocurrencies. This was shaken when the $ 12 billion trading platform known as Celsiusfroze the withdrawal of earlier this month. This has affected major companies such asCrypto.comand Coinbase. They surged during the pandemic, but are now firing thousands of workers and canceling jobs in the United States and Canada.

Clash Conference founder and CEO Paddy Cosgrave said many cryptocurrencies were expected to participate, but withdrew at the last minute. I am. (Wayne Simpson / CBC)

Many crypto companies were scheduled to participate in the direct conflict, but the founder and CEO of the conference Paddy Cosgrave. Just barely. Celsius CEO Alex Mashinsky was one of the people who was going to attend, but he didn't.

"I can understand why [he] had to pull out," Kosgrave said. "I think he's in a big fight with his hands to sort out this situation."

Whatever dark clouds could overhang the crypto space, Cosgrave , Says it did not affect the overall attendance of over 35,000 people. This is a completely reasonable enthusiasm for him.

See | Cryptocurrency is plummeting:

Investors are at risk in rising interest rates Bitcoins and other cryptocurrencies are plummeting in order to escape from valuable assets. Binance, the world's largest cryptocurrency trading platform, has also temporarily suspended withdrawal of cryptocurrencies.

"When things become uncertain, everyone goes looking for an answer," he said. "And certainly in the last few weeks there have been many big questions about what's happening with technology, especially cryptography."

Layoff can be a short-term outlook However, Cosgrave states that the future of Canadian and international technology remains bright.

"What happens if you fire a very smart software engineer? Many of them have started new companies and some of them are already here," he said.

See | The engineering department was hit by layoffs and reductions:

for years After steady growth, the prices of technology stocks and cryptocurrencies around the world have fallen, making it a remarkable company.