Code42, a Minneapolis-based tech firm, has laid off about 15% of its workforce, a company spokeswoman confirmed.
The data security company did not share its most recent headcount or the number of workers fired, but dozens will be affected.
CEO Joe Payne told the Star Tribune in January 2021 that the company had about 500 employees with plans to add another 50 or so workers in the coming months.
In a statement, Payne said Code42 sold its legacy CrashPlan business, which represented more than half of the company's revenue, about three months ago. But he said only 20% of the costs associated with the business were included as part of the transaction.
"Given the economic outlook for 2023, it would be irresponsible for us not to reduce our cost base in preparation for difficult, uncertain economic times to ensure the future success of Code42," he said in the statement. "Unfortunately, that means parting ways with a number of smart, dedicated and talented employees. We will do our best to help each and every one of them land on their feet."
Code42 joins a growing number of tech companies, mostly in Silicon Valley, that have been making sizable cuts to their workforces in recent weeks as the economy has been softening and as the Federal Reserve has been aggressively hiking interest rates to try to cool off high inflation.
Last week, ride hailing firm Lyft announced it was laying off 13% of its staff, and Stripe, the payment-processing platform, said it was letting go of 14% of its employees.
Elon Musk laid off about half of Twitter's corporate workforce on Friday in the first week he took control of the social media company.
And the Wall Street Journal reported that Meta, the parent company of Facebook and Instagram, is planning significant layoffs later this week.
Still, despite the flurry of headlines about tech companies, overall layoffs remain at historically low levels in what continues to be a fairly strong labor market. The number of job openings remain high while the number of unemployed workers is quite low.
The U.S. added 261,000 jobs — more than forecasters expected — last month. Minnesota's job report for October will come out next week.
After reporting the lowest unemployment rate in U.S. history this summer, Minnesota's jobless rate has since ticked up slightly to 2% but still remains the lowest in the country. The U.S. unemployment rate is 3.7%.
Code42's headcount has moved up and down in the past few years as its business has fluctuated. At one point, it had around 600 workers.
In recent years, it has been focusing more on its "Incydr" service, which is aimed at helping to stop data leaks and intellectual property theft.