LinkedIn closes development center in Israel, dozens of employees to be laid off

LinkedIn is closing its development center in Israel, laying off all employees. The center was opened in February 2022 after the acquisition of Oribi for $80-90 million. The closure is linked to the high-tech crisis: the strengthening shekel makes labor more expensive, and companies are moving development abroad. About 40,000 jobs are at risk.

International company LinkedIn is closing its development center in Israel and laying off all employees. This was reported on Tuesday, August 11, by the economic publication Calcalist. LinkedIn's research and development center in Israel was opened in February 2022 after the company's first acquisition in the country—the Israeli analytics company Oribi. It was founded by entrepreneur Iris Shor, and the deal was valued at $80-90 million. The deal and the creation of the center were overseen by Tomer Cohen, LinkedIn's chief product officer. Although LinkedIn is owned by Microsoft, the Israeli center was established as an independent structure, completely separate from the parent company's development center. The center, located in Tel Aviv, focused on technology, engineering, and product. After the acquisition, Oribi's technology, which specializes in user behavior analysis and no-code optimization (No-Code Analytics), was integrated into LinkedIn's Marketing Solutions division. The Israeli team was responsible for developing measurement tools, conversion attribution, and advanced analytics. These allow advertisers and businesses on the platform to assess the return on investment (ROI) of advertising campaigns. In response to Calcalist's request, the company stated: "We are making these organizational changes in some roles to best position ourselves for future success, focusing our teams' and business's efforts on the priorities with the greatest impact for our clients and partners." The closure of LinkedIn's Israeli center is part of a broader picture of the high-tech industry crisis. On May 24, Calcalist reported that the layoffs in the sector are often driven not only by the adoption of artificial intelligence but also by the sharp appreciation of the shekel against the dollar, making Israeli employees 15-20% more expensive in dollar terms—companies began freezing hiring and moving some teams abroad. On May 31, Vesti wrote that for the first time in ten years, the number of developers in Israel decreased—by about 3,500 people over the year—and companies are increasingly moving development centers to the US and Eastern Europe. Only 62% of employees of private Israeli high-tech companies still work in the country. Tens of thousands of jobs are at risk: according to calculations by Ronen Nir, a partner at venture capital fund PSG, about 40,000 positions are at risk due to the rising cost of labor in dollar terms. According to a survey by the High-Tech Association, most surveyed companies are preparing for a profit decline of 15% or more, which could lead to further layoffs and relocation of operations abroad.