Who gets cut first in a B2B layoff? Recruiters, then SDRs

When software and IT companies shrank in 2022 to 2024, recruiters were 2.2% of their staff at the peak but 4.1% of the people they lost. Recruiting teams fell 49% from the peak to the low point, against 26% for the companies as a whole.

Part of that was the hiring slowdown everywhere. Even companies that did not shrink had 9% fewer recruiters over the same quarters, while their total headcount grew 13%. Net of that normal churn, recruiting was still cut 1.26 times harder than its size (95% interval 1.11 to 1.42), more than any of the other five teams we measured. It was also the slowest to come back.

How we measured the cuts

We rebuilt quarterly headcount for every company in Ken internal data from the start and end dates of people's roles, and grouped people by job title into teams. The data covers people who live in the US, the UK, Canada, Australia, Ireland and New Zealand, so every headcount here means staff in those six countries.

Of 12,203 software and IT companies with at least 50 such people, 54% saw headcount fall 10% or more from a peak between 2022 Q1 and 2024 Q4. We kept the 5,482 that were still hiring after their low point, which leaves out most shutdowns and acquisitions.

For each company we compared every team's share of the people lost with its share of staff at the peak. That ratio is the cut index: 1 means a team lost people in proportion to its size, 2 means twice as fast. Recruiting's raw cut index was 1.86.

Rebuilt headcount cannot tell a layoff from a resignation, and teams shrink for ordinary reasons too. So we tracked the same teams at 5,565 software and IT companies of similar size that did not shrink, over the same quarters. The net cut index compares each team's shortfall from where it would have been at those companies with the shortfall of the company as a whole.

Recruiting went first

Recruiting headcount turned down a quarter before the company's peak, when it already stood at 100.7% of its peak-quarter level. Two quarters after the peak it was down 23%, against 9% for the company. With hiring frozen, there is little for a recruiting team to do. SDRs fell 20% over the same two quarters.

Inside sales, the cuts landed on new business

SDRs and BDRs, the junior reps who book first meetings, were cut hardest of any sales role, with a net cut index of 1.63. Account executives came next at 1.18. Account managers, who look after existing customers, were cut less than their size, at 0.86. Sales as a whole sat at 1.07.

The other teams:

• Marketing was cut harder than its size, at 1.14. Customer success came in at 1.08.
• Engineering was not spared. It lost people slightly faster than the company, at 1.06, and software engineers alone at 1.09. Engineering managers (0.90) were kept more often than the engineers they managed (1.07).
• Support was the one team cut less than its size, at 0.80. Its headcount fell 24% at the shrinking companies while the companies fell 26%, and it had been growing more slowly than most teams even at companies that did not shrink.

Put together, the teams that bring in new hires and new pipeline (recruiting, SDRs, marketing) lost the most. The teams that protect revenue already won (account management, support) lost the least.

Recruiting was the last to come back

Two years after the low point, sales teams were back at their peak size at 41.2% of these companies, engineering at 38.9% and marketing at 36.3%, as often as or more often than the companies themselves (36.1%). Recruiting was back at only 20.8%.

Recruiting stayed down even where nothing shrank. At software and IT companies that never shrank, recruiting headcount peaked in 2022 Q3. By 2026 Q1 it was still 11% below early 2022, while total headcount at those companies had grown 22%.

By company size and industry

Recruiting topped the list at every size from 200 people up: 1.30 at 200 to 999 people, 1.29 at 1,000 to 4,999 and 1.46 at 5,000 or more, a group of only 35 companies. At 50 to 199 people, marketing was cut hardest (1.18) and recruiting about in line with its size (1.02). Support was cut least at every size.

Outside software the order shifts. Customer success teams, which hold less than half a percent of staff in those industries, were cut hardest in four of the six other industry groups, for example 1.66 in manufacturing, industrial and energy companies and 1.58 in life sciences. Recruiting was cut harder than its size in every group, from 1.19 in business services to 1.58 in industrial companies.

What we expected

We wrote down seven predictions before reading any data. Recruiting would be cut hardest, with a net index above 1.5: it was the highest of the six, but at 1.26. Engineering would be cut least: wrong, support was. Marketing would be cut harder than its size, and recruiting would be the team least often back at its peak: both right.

We also changed the net index after the first run, because the version we registered mixes normal churn back in. On the registered version, recruiting's net index is 1.02 and customer success is highest at 1.15. The methodology reports both.

What it means for a lean year

• Future capacity goes first. When B2B companies shrink, the first jobs to go are the ones that build capacity for later: recruiters, SDRs and marketers.
• Revenue already won is protected. Account managers (0.86) and support (0.80) were cut less than their size.
• Plan the restart early. Recruiting is cut first and rebuilt last: two years after the low point it was back at peak at only 20.8% of these companies. That matters when hiring has to start again.
• Read raw numbers with care. Recruiting shrank even at companies that grew, so a raw fall overstates how hard a team was cut.

What this data cannot show

• Six countries only. Staff elsewhere are not in the data, so a company that moved jobs abroad looks as if it cut them. Engineering may be overstated for that reason.
• Profiles, not payroll. People add new jobs late and leave some short jobs off, so recent quarters undercount hiring and the regrowth shares may run low.
• Layoffs and resignations look the same. The comparison companies remove normal churn, but not every difference between the two groups.
• Titles define teams. A recruiter who kept the job but changed title is counted in the new team.
• Linked with, not caused by. These are patterns across thousands of companies, not proof of what any one company should do.