The mood in Silicon Valley, literally and metaphorically one of the sunniest places on earth, has darkened.

It’s not just about wrenching layoffs, nauseating stock-price declines, and invasive regulatory probes. True, Elon Musk’s decimation of the Twitter workforce (down more than 60 percent) was a gut punch. And the hacking at Salesforce, Amazon, and Meta and pruning at DoorDash, Stripe, Lyft, and Netflix contributed to the gloom. The tech-heavy Nasdaq Composite Index’s 33 percent decline in 2022, the evaporation of $855 billion in Tesla’s valuation, and the E.U.’s latest $400 million fine of Meta over its ad practices all were genuine buzzkills.

But the vibe shift in the technology industry as it heads into 2023 goes deeper and is likely more permanent. It promises nothing less than a recalibration of the employer-employee relationship in Silicon Valley and, in the ultimate labor-relations knock-on effect, every industry that has followed tech’s lead for a generation.

There’s no better example of the change in mindset than the day Musk canceled free lunch at Twitter. Meals on the house are a totem in Silicon Valley. A company that doesn’t feed its hungry employees couldn’t possibly cater to their other needs as well. Why work anywhere like that?

A Google employee takes a break in one of the company’s sleeping pods.

Musk promptly got into a public spat with the fired Twitter executive who had overseen culinary benefits. She said he was exaggerating historic costs, and, given his record for veracity, she was probably right. But no matter. The erratic billionaire had made a point: Don’t expect your employer to pay you a competitive wage and feed you for free. These were fighting words, though, in an industry that has become known as much for its perks as it has for its transforming nerds into billionaires. (Let’s stipulate, by the way, that Musk’s firing of Twitter janitors, short-supplying of toilet paper, and refusal to pay Twitter’s rent constitute his unique cravenness rather than Silicon Valley trendsetting.)

Google arguably set off the entitlement competition in the early 2000s. While bankers and lawyers in New York slaved away in dreary cubicles for companies that barely allowed them to expense a desk lunch, tech employees in Mountain View could get their laundry done; drop off their dry cleaning; get an oil change; attend subsidized exercise classes; get a massage or a haircut; study Mandarin, Japanese, Spanish, and French; and ask a personal concierge to arrange dinner reservations.

The vibe shift in the technology industry promises a recalibration of the employer-employee relationship in Silicon Valley and every industry that has followed tech’s lead for a generation.

That was just the beginning, and also the opening salvo of a war for talent that mushroomed during a nearly two-decade-long era of easy money and rapid growth among Silicon Valley start-ups.

This epoch continued right up until last year, when a nasty combination of a real war, sky-high interest rates, imploding crypto-currencies, and a tumbling stock market began to turn the cranks on a tech-sector slowdown.

Perks are a lagging indicator.

A mere two months ago, a “day in the life” TikTok of a 23-year-old product manager at Facebook parent company Meta bragging about her many fringe benefits went viral. Another TikTok, which went so viral that it inspired numerous spoofs, listed the “cool perks of working at a tech company,” among them “free breakfast,” a “hygiene station,” “hair tools,” “amazing views,” and “unlimited snacks.”

The reactions were very 2022—one batch of comments focused on the videos’ entitled tone, another on the misogyny of those comments—but the aftermath is likely to be far more 1990 or 2001 or 2008, each a period of retrenchment in the overall economy.

The salt-and-pepper-haired crowd—those who remember life before Facebook—is fed up. One manager of a certain age complained to me recently about a new college grad who was unsure about taking a job because of her misgivings about the politics of the company’s C.E.O. “I thought, You don’t have the job yet, and no one cares what you think about the C.E.O.’s political tone.”

Another executive of a similar vintage told me of an employee at a buzzy public company about to undergo layoffs who complained, without irony, that the company’s Marin Kombucha tap hadn’t been re-filled.

There are signs, though, that the pendulum is swinging.

The industry has become known as much for its perks as it has for transforming nerds into billionaires.

During a weekly Q&A with employees, Mark Zuckerberg failed to contain his frustration when, after an introductory speech in which he said he expected the economy was headed for one of the “worst downturns we’ve seen in recent history,” an employee named Gary, from the Chicago office, asked if “Meta Days”—extra days off introduced during the pandemic—would continue in 2023. “Given my tone in the rest of the Q&A, you can probably imagine what my reaction to this is,” Zuckerberg said. (Meta Days have been canceled as of January 1.)

Similarly, during a company-wide all-hands meeting recently, Google’s Sundar Pichai found himself fielding employees’ questions about the company’s travel-and-entertainment-budget cuts. He reportedly answered in an annoyed tone, explaining the macro-economic conditions behind the cuts. “We shouldn’t always equate fun with money,” Pichai said. (Last week, The New York Times reported that Google employees are now bracing for mass layoffs being instituted in an effort to curb costs.)

Even Pony Ma, the usually mild-mannered C.E.O. of Chinese tech company Tencent (which owns the country’s most popular instant-messaging-and-social-media app, WeChat), expressed his frustration in an employee town hall just ahead of the holidays: “You can’t even survive as a business, yet you’re chilling on the weekends, playing ball.”

Meanwhile, the Information, a tech newsletter, reported that companies were “reining in their once-legendary holiday parties.” Think 2015, when Yahoo reportedly spent $7 million on a Great Gatsby–themed end-of-year bash, complete with a champagne tower and burlesque dancers. Or 2018, when Facebook transformed San Francisco’s Palace of Fine Arts into a “winter wonderland” featuring fake snow and an ice sculptor. As recently as 2021, Salesforce employees welcomed the holiday season with a private Maroon 5 concert. (Adam Levine was still scandal-free at the time.)

“We shouldn’t always equate fun with money.”

This past year was different.

José Cong, a veteran of Apple and Nest who runs recruiting for a start-up consumer-electronics company called Humane, says applicants still ask for signing bonuses of up to $100,000 and present him with a documented list of required perks. But now, he says, “we can have an open, honest conversation about why that’s not going to happen.”

While it’s apparent to Cong that we’ve entered a new era, he’s “not sure the average employee realizes the world has changed.” It reminds me of Japan in the mid-1990s. It was obvious to foreigners the country was in a multi-year decline. But it hadn’t quite sunk in for the Japanese. Eventually stagnation became the reality. Tech workers, too, will figure out that a good job, generous perks or not, is a precious thing.

A homeless encampment in Cupertino, California, where Apple is based.

Some are coming to a more radical conclusion: that excessive goodies don’t compensate for the pressure-cooker environment. Pippa Kennard worked in human-resources roles—“people operations,” in tech-speak—for Lyft, Pinterest, and Asana before decamping for a job at Stanford. Kennard says that at one of her previous employers, she tried to address the stresses of unrealistic expectations for her co-workers when she realized she was tilting at windmills. “I said to myself, What’s the point of giving people free therapy if the work environment itself is causing their suffering?” Kennard thinks that her experience working from home, where perks were fewer, eased her decision to leave tech. “Then I was faced with a toxic work culture without the sugarcoating of all the perks.”

There are some companies that are trying to tweak perk culture. Chegg, a digital-textbook publisher, has started using an app called Fringe, which lets employees earn points that can be applied to everything from gym memberships to getaway weekends, to student-loan repayments. “It’s not one-size-fits-all,” says Emma McCulloch, a corporate communications executive at the company. “It’s just being smarter rather than throwing a bunch of money at something.”

Maybe. What’s more likely is continued retrenchment for an industry that got too ahead of—and too full of—itself. What most freaks out tech denizens young and old is uncertainty. They realize they’re in an unsettling moment when no one knows what’s next.

Silicon Valley is on a 40-year run of replacing the last wave with another. Semiconductors begat computers, which led to the Internet and then mobile phones. Today, the tech industry is at a genuine loss for what the next new thing is.

It doesn’t help that the last few next new things have fizzled. Crypto-currencies, the blockchain, and “Web3” (an alternative to the World Wide Web) are looking more and more to be the subprime mortgages of the early 2020s, as destructive of fortunes and reputations for venture capitalists as they are for ordinary investors. And while Musk spends billions to attempt to colonize Mars, scientists at Lawrence Livermore National Laboratory, a research facility run by the U.S. government, just recently achieved the breakthrough of nuclear fusion, which could preserve life’s sustainability on earth.

Even geography is working against tech. San Francisco supplanted its southern suburbs in the last 15 years as the pulsing heartbeat of the industry. Now the city is a ghost downtown of homeless encampments and zones of lawlessness. Recently, a downtown office worker called ahead to place his order at the trendy Blue Bottle coffee shop, only to find no line when he arrived. “Mondays are the new Fridays,” reported a sullen barista.

If the vibe has indeed shifted, the die was cast long ago for Silicon Valley. After all, Google’s “Don’t be evil” slogan induced smirks as soon as Larry and Sergey said it. Tim Cook’s Apple has been accommodating the Chinese Communist Party for years. Earnest college grads who’ve come of age in an era of low-interest-rate-fed cheap capital may have believed otherwise, but Silicon Valley has been just another—if inordinately successful—cog in the machinery of American capitalism for some time. It’s the recognition of that shift that is nearly complete.

Adam Lashinsky is the former executive editor of Fortune magazine and author of Inside Apple: How America’s Most Admired—and Secretive—Company Really Works. Currently a freelance journalist, he is writing a biography of the late columnist and presidential speechwriter William Safire