In a recent note, Goldman Sachs makes the case the recent spate of layoffs in the tech sector are not a viable sign of an impending recession.

Goldman Sachs chief economist Jan Hatzius said in the note, “Tech layoffs are not a sign of an impending recession.”

Amid a dismal year for stock prices and growth, the announcements of layoffs have been multiplying in the tech sector lately.

In just the last two weeks, both Amazon and Meta have laid off a combined 21,000 workers after experiencing soft third quarters.

Following Elon Musk’s acquisition of Twitter, he immediately laid off half of its workforce when he cut 3,700 employees.

Hatzius assembled a comprehensive chart examining the 34,000 layoffs that have been announced so far, from large-cap tech stocks in November, displayed below:

However despite the sheer number of lost jobs, the Goldman analyst went on to explain three reasons why these layoffs are not a foreshadowing of impending doom.

First, the tech sector is not the dominant employer in the economy. She noted, “First, the tech industry accounts for a small share of aggregate employment — for example, the unemployment rate would rise by less than 0.3 percentage points even in the inconceivable event that all workers employed in the “internet publishing, broadcasting and web search portal” industry are immediately laid off — so any drag on the overall labor market should be small.”

Second, she points out the tech sector is still hiring, noting, “Second, tech job openings remain well above their pre-pandemic level, so laid-off tech workers should have good chances of finding new jobs.”

And finally, she highlights that historically, tech layoffs have not been harbingers of greater unemployment in other sectors of the economy, when she says, “… tech worker layoffs have frequently spiked in the past without a corresponding increase in total layoffs and have not historically been a leading indicator of broader labor market deterioration, and layoffs in other industries still look limited.”

So while widespread layoffs are never a good sign in any economic sector, the current spate of layoffs in the tech-sector are not necessarily a harbinger of any greater unemployment about to begin in the broader economy.