PALO ALTO, U.S. -- The number of employees who work for the four major U.S. tech companies, Apple, Google, Amazon and Facebook, has now exceeded 1 million worldwide.
Data from the U.S. Securities and Exchange Commission shows that in the past five years, staff working for Big Tech increased 3.5 fold, outpacing the growth of sales for the same period, which grew 2.3-fold.
The rapid increase is a result of the tech companies expanding the scope of their business as well data-protection measures. But the rise of labor costs could lower business performance, and the sheer size of the workforce is giving employees a new voice that is putting management under pressure.
As of the end of September, employees at the four companies totaled 1,044,000, a 20% increase from a year ago. Amazon, which operates large warehouses and owns upscale supermarket chain Whole Foods, led the pack with 750,000 staff. Apple (137,000), Google's holding company Alphabet (114,000) and Facebook (43,000) followed, respectively.
Facebook has seen the highest growth rate over the past five years, employing 5.2 times more people than it did at the end of September 2014. A large portion of the added staff is tasked with monitoring social media fraud. With the increase in labor costs, operating profit margin -- which sometimes exceeded 50% on a quarterly basis until two years ago -- now dips below 30%.
But money is not the only concern for management.
When Amazon employees launched the first labor strike in the company's 25-year history on Sept. 20, seeking measures to tackle climate change, one of the movement's leaders Justin Campbell, a data engineer, said, “[Broad support] made us realize we had real power as employees and pushed us to get bigger and do more.”
About 1,750 employees took part in protests in cities such as Seattle. Facing the risk of losing talent, CEO Jeff Bezos quickly announced a "Climate Pledge" the day before the rally, vowing to make Amazon net zero carbon across its businesses by 2040 -- a decade ahead of the Paris Accord’s goal of 2050.
At Google, as employees rebelled against the company's artificial intelligence technology being used for military purposes, CEO Sundar Pichai last year announced a set of AI principles that prohibited development that will be used for weapons or technologies whose principal purpose is to cause injury to people.
Meanwhile, the rapid increase of new staff is causing friction in communities.
According to a real estate company in Silicon Valley, the five companies of Google, Apple, Facebook, Amazon, and Microsoft-affiliated LinkedIn, had a total office space of 4.05 million sq. meters, equivalent to 87 Tokyo Domes or 750 football fields, as of 2018.
That accounts for a threefold increase from six years ago, with the five companies occupying 18% of the available offices in the region.
With highly paid tech talent flowing in, real estate prices have soared. Even people with stable jobs are being forced to move due to soaring rents. The homeless population in Santa Clara County, which includes Silicon Valley, has risen to 9,700 in 2019, a 30% increase compared with the last survey two years ago.
That has resulted in teachers and firefighters leaving the area. Maria Noel Fernandez of Silicon Valley Rising, an organization that addresses the region's housing problems, has complained to major internet companies that they have an obligation to consider the lives of "subcontracted workers who provide critical services to tech companies throughout the Valley."
After building a new $5 billion headquarters in Silicon Valley in November, Apple announced a $2.5 billion plan to help address the housing availability and affordability crisis in California.
"Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and we feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community," CEO Tim Cook said in a statement. "Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable."
