China 2021 tech crackdown: once seen as the golden ticket, Big Tech has shed jobs and lost its allure among the young
- The change of mood in China’s tech industry is tangible and sudden after a decade of exceptional growth
- Chinese users of internet services have also had to modify their behaviour in 2021 to comply with a barrage of new regulations
Xiang Zikui, a Shenzhen-based woman who works in the gaming division of one of China’s biggest internet companies, says she was shocked to hear about large-scale lay-offs at iQiyi, often dubbed China’s Netflix.
The Baidu-owned company, operating one of the country’s biggest video streaming platforms, reportedly started trimming more than 30 per cent of its workforce at some high-expense departments earlier this month, in a wave of lay-offs that is expected to continue through the Lunar New Year.
Short video giant Kuaishou Technology has also started to let go of employees who received low scores in performance reviews, the South China Morning Post reported earlier this month, citing three people familiar with the matter. Laid-off employees have been offered compensation based on the number of years they have served, plus one month’s salary, the people said.
While neither company was directly targeted by Beijing’s year-long crackdown on the country’s tech giants, the job cuts reflect a tougher overall environment for internet companies amid tighter regulations, more scrutiny of content and zero tolerance of monopolistic practices.
“The lay-offs may have more to do with the general industry trend,” said Xiang. “There are now strong regulations on many things including games, online ads and everything that involves privacy, which makes me feel like the industry may have hit a bottleneck.”