California Faces Massive Layoffs as Businesses Exit State: 1,000 Jobs Lost in Bay Area
California is experiencing massive layoffs as more businesses leave the state.
More than 1,000 jobs were lost in the Bay Area recently, with hundreds related to the Oakland Athletics, a Major League Baseball franchise, leaving the region.
Moxion Power, a green energy technology company, has also announced significant layoffs, while Vintage Wine Estates is declaring bankruptcy.
Overall, the area’s WARN letters indicate that around 1,071 workers will lose their jobs in the Bay Area. As the Oakland A’s head to Sacramento and Las Vegas, 591 Bay Area workers are likely to lose their jobs by October. This includes 415 layoffs at the Athletics Investment Group and 176 job cutbacks at Bay Area Sports Catering, which provided concessions for the MLB team.
“The Oakland A’s franchise encapsulated itself with this Moneyball approach, where they could find players at a discount and win games,” Kevin Thompson, a former A’s player and financial expert, told Newsweek. “The product Oakland has put in the field for the past few decades has been paltry at best, and the fans deserve better.”
The Oakland Athletics are set to finish the 2025 season in Sacramento before moving to a new ballpark in Las Vegas.
“In April 2024, we announced that 2024 would be our final season in Oakland, and as a result, there will be a reduction in force,” Adam Scoggan, the Oakland A’s vice president of people operations, stated in a WARN letter.
Moxion Power is eliminating 427 jobs in Richmond, while Vintage Wine Estates is eliminating 233 jobs in Sonoma and Napa counties.
“Unanticipated challenges in integrating acquired businesses, including maintaining overlapping and/or duplicative administrative departments, resulted in unexpected costs,” Seth Kaufman, the company’s CEO, told the court. “At the same time, performance for acquired entities declined unexpectedly.”
Moxion Power’s employees are being laid off after the company raised $110 million but failed to secure additional funding for its new production.
“I’m writing to you this morning with a heavy heart,” CEO Paul Huelskamp told employees in an email this month, according to SFGate. “We have not found a path that will allow us to continue operations as Moxion Power Co., and effective today, we will be closing our doors.”
According to data provided by SiliconValley.com, tech companies shed almost 7,000 jobs in the Bay Area alone between April and June. This followed a year of constant layoffs across the business.
During the pandemic, the tech industry saw a surge in demand as people hid in place and began working from home on a big scale. However, as pandemic limitations eased, people returned to work, and tech interest faded.
However, HR consultant Bryan Driscoll blamed California’s enormous layoffs primarily on “corporate greed” and “short-sighted management practices.”
“Companies are cutting costs by slashing jobs instead of investing in their workers and communities, prioritizing immediate profit margins over long-term stability and growth,” Driscoll told Newsweek at the time. “Several organizations are leaving the state, blaming regulations and taxes, but the truth is they want to maximize profits at the expense of employees.”
Companies might increase profits by relocating to jurisdictions with fewer worker rights and cheaper pay, but such movements may leave a “trail of economic devastation” in their wake, according to Driscoll.
“This exodus and the resulting job losses are devastating to the local economy,” she said. “Workers are left struggling, facing uncertain futures, and scrambling to find new employment while executives line their pockets.”
As the layoff cycle continues, employees may lose trust in their companies. This effect might be seen not only in California but also in other states as workers in related industries take notice, according to Toni Frana, a lead career specialist at FlexJobs.
“Anytime there are mass layoffs, the impact can be felt beyond the organizations making staff cuts,” Frana told Newsweek. She continued: “The worry of ripple effects can take hold.”