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Thursday, January 21, 2021

Uber cuts 3,000 jobs as virus slashes payroll numbers by 25%

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Uber has cut 3,000 jobs from its workforce, its second major wave of layoffs in two weeks as coronavirus slashed demand for rides.

The San Francisco company has cut a quarter of its workforce since the year began, after eliminating 3,700 people from the payroll earlier this month.

Uber will be refocusing on its core business, moving people and delivering food, said chief executive Dara Khosrowshahi in a note to employees.

The ride-hailing giant will be closing or consolidating 45 offices globally, and almost all departments will be affected by layoffs.

The company is closing its Incubator and AI Labs and will pursue strategic alternatives for its job recruiting app, Uber Works, Mr Khosrowshahi said.

“This is a decision I struggled with,” he said.

“Our balance sheet is strong, Eats is doing great, Rides looks a little better, maybe we can wait this damn virus out… I wanted there to be a different answer… but there simply was no good news to hear.”

The rides business, Uber’s main profit generator, fell 80%, he said.

“Ultimately, I realised that hoping the world would return to normal within any predictable timeframe, so we could pick up where we left off on our path to profitability, was not a viable option,” he said.

Uber lost 2.9 billion dollars (£2.4 billion) in the first quarter as the pandemic hit its overseas investments. Companies that rely on the sharing economy have been hit hard by the pandemic, as people stay indoors and shy away from shared services to reduce the spread.

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