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Same situation here in IT. My department just had three infrastructure upgrades indefinitely shelved last week despite management calling them critical last month. It’s definitely not just you. The lack of transparency from leadership is what kills morale, but you're spot on about the headcount rumors. They always squeeze the operational budget first to make the quarterly numbers look better before the layoffs start. Start polishing the resume now, because the vibe in the office has been grim since the last all-hands meeting.
I've worked at WEC for a while now and I’ve seen this playbook before. The 'tightening the belt' phrase is code for preserving dividends at the expense of projects and personnel. Don’t wait for them to give you a clear answer because they won’t until the day they hand out the severance packages. It’s frustrating to see 'priority' work stall out, but prioritize your own job security. If the POs are freezing, that’s your signal that the internal financial outlook is worse than they’re letting on. Stay alert.