[Post 476] Why Widespread Tech Layoffs Keep Happening Despite A Strong U.S. Economy

Summary

The tech sector is having a big 2024. Nvidia just crushed earnings expectations. The AI boom remains in full swing. The tech-heavy Nasdaq index is up more than 8 percent year-to-date.

The U.S. economy is also doing surprisingly well, adding 353,000 jobs in January, well ahead of economists' forecasts. Hotter-than-expected inflation data may also keep the Fed from cutting rates as soon as the market expects, a sign that the economy remains strong enough to support higher interest rates for longer. It's a different story for tech workers, though.

"The layoffs to the start of 2024 signal a dramatic shift in the tech industry," said Jeff Shulman, professor at the University of Washington's Foster School of Business. "We're going to continue to see layoffs happen as the future of work has changed, as the future of technology has changed, and as investors appetite for risk and growth versus profitability has dramatically changed as well."

The number of tech sector layoffs in 2024 has been outpacing the number of terminations in 2023. So far, about 42,324 tech employees were let go in 2024, according to Layoffs.fyi, which tracks layoffs in the tech industry. That averages out to more than 780 layoffs each day in 2024. In 2023, nearly 263,000 tech employees got laid off, averaging about 720 firings each day that year.

There are several factors behind the churn. Artificial intelligence is at the forefront. Companies need to free up cash to invest in the chips and servers that power the AI models behind these new technologies. There's also the stock market effect. Companies that conducted layoffs haven't been punished for it, either by investors or on their bottom lines.

Watch the video above to find out more about why tech workers may be poised to endure another rough year of layoffs, and why the surprising strength of the U.S. economy may not be coming to their rescue.

[Post 475] How Nescafé Instant Coffee Is Made

Summary

With annual sales of $11.6 billion as of December 2023, Nescafé is Swiss-based food giant Nestlé’s largest coffee segment. Sold in over 180 countries, one in seven cups of coffee consumed worldwide is a Nescafé. Globally about 3 billion cups of coffee are consumed each day and that number is expected to rise. To keep up with demand Nescafé works with over 100,000 farmers and buys more than 13 million bags of green coffee annually. It also has two dozen factories globally. But producers are facing a number of challenges including fluctuating coffee prices and higher labor costs . So how is Nescafé instant produced? CNBC traveled to Vietnam to get a behind the scenes look at Nestle’s operation to find out.

[Post 473] How Ghost Kitchens Went From $1 Trillion Hype To A Struggling Business Model

Summary

Food delivery is a booming business in 2024. There's one food delivery trend, however, that hasn't gone along for the ride: ghost kitchens.

Once a pandemic darling that raised more than $3 billion in venture funding, the ghost kitchen industry is falling short of lofty expectations. Euromonitor International estimated that the ghost kitchen industry could reach a market size of $1 trillion by 2030.

Big brands wanted a piece of the pie. Companies such as Wendy's, Ruby Tuesday, TGI Fridays and Wingstop all joined the wave of ghost kitchens."It is clear that the impact of ghost kitchens was overestimated," said Evert Gruyaert, restaurant food and service leader at Deloitte. "And we see that today with the decline in ghost kitchens."

Consumers complained about the clandestine nature of ghost kitchens, and food delivery apps shuttered thousands of the virtual kitchens. Then consumers shifted back to brick-and-mortar restaurants in droves, forcing investor pullback and mass closures of ghost kitchens.

Now the smaller businesses left in the industry are pivoting to a new business model to survive. Some hope to diversify the food business to expand to events and catering, not just delivery. One such business is New York City-based Nimbus Kitchen, a co-cooking space hoping to shed the negative connotation of ghost kitchens.

"Shared kitchens and co-cooking infrastructure like Nimbus is here to stay," said Camilla Opperman, Nimbus Kitchen co-founder. "We believe that the future of the industry is catering towards not only the delivery concepts, but to all of these different kinds of food businesses that ultimately need the kitchen space to legally sell to the end consumer."

Watch the video above to find out more about the rise, fall and future of ghost kitchens and if the business can pivot to return to its pandemic highs.

[Post 466] Chomps: How We Turned $6,500 Into A Business Bringing In $244 Million A Year

Summary

Looking to make a healthier-for-you meat snack, friends Pete Maldonado and Rashid Ali together put forth $6,500 to launch their "side hustle" back in 2012. After four years, Trader Joe's began selling their products and sales significantly grew. In 2023, Pete and Rashid's once side-hustle has brought in nearly $250 million in retail sales.

[Post 461] I Make $220K A Year - And I Live With My Parents

Summary

Sal Khan, 31, moved from California to Texas to live with his parents during the 2020 pandemic. They insisted on not charging him rent. He saw this as an opportunity to build a stronger relationship with his parents, save money, and potentially purchase some properties for his future. Now, almost four years later, he has been able to save over $200,000 and has a real estate portfolio consisting of four properties across the U.S.

This is an installment of CNBC Make It's Millennial Money series, which profiles people across the globe and details how they earn, spend and save their money.

[Post 460] Americans Bought Abandoned $1 Homes In Italy — Was It Worth It?

Summary

In the late 2010s, towns around Italy started going viral for selling off crumbling properties for 1 euro, or roughly $1.05. How much does it really cost to buy and renovate a 1-euro home in Italy? And is it worth it? CNBC Make It spoke to several Americans who have bought a 1-euro home in Sicily, Italy.

[Post 458] My Side Hustle Brings In $400K A Year—Here’s How I Spend My Money

Summary

Chisom Okwulehie was gifted at drawing from a young age. She decided to turn her artistic instincts toward a more profitable line of work, studying architecture and public planning in college. Today, the 35-year-old mother of two earns about $163,000 a year working as an architectural designer for the Port of Authority for New York and New Jersey and running her own interior design side business for private clients, Juntero.

This is an installment of CNBC Make It's Millennial Money series, which profiles people across the globe and details how they earn, spend and save their money.