Since the Great Financial crash of 2008/9, ordinary people have struggled to get well paying jobs, while people in the tech sector were fighting off headhunters dangling very good pay and benefits before them.
That trend is now reversing: there are loads of jobs available for ordinary people, while rising interest rates are putting the squeeze on the tech sector.
This shouldn't come as a surprise. While interest rates were zero, venture capitalists could borrow vast sums and throw the money at wannabe unicorns like Lyft and Uber. They didn't even need these start-ups to be profitable, they just needed a succesful IPO so the venture capitalist could cash out for 100 times their stake, repay the original zero-interest loan and pocket the rest. Kerching!
That model doesn't really work when interest rates rise. The people buying the shares of a newly listed IPO were also borrowing to buy, and the numbers don't add up at higher interest rates. At 2% interest rates, you need the prospect of profits and dividends to justify the loan you've taken to buy the shares.
Shares like Lyft have been crashing, and it's unlikely they'll be able to raise more funding from venture capitalists. They have just one option: cut costs in an attempt to make a profit.
More established companies like Paypal and Netflix have also announced layoffs. Their share prices have fallen sharply from their highs (in the case of Paypal by over 80%) and they know they won't see an improvement till their profits rise. Even that great survivor Microsoft has put in place a hiring freeze.
The layoffs in the tech sector won't affect the unemployment numbers much. Less than 5% of the workforce works in tech, and many of these are foreigners on H1b visas who will return home if laid off.
However, highly paid tech workers do impact the rest of the economy in several areas. Their layoffs will impact the cost of housing where they congregate, and the high-end goods they buy (gadgets, cars etc).