Uber cuts full-time employees by 25% in May only

Uber announced on May 18 (local time) that it would fire 3,000 employees. This was followed by announcing that 3,700 people would be fired on May 7th. In May alone, a whopping 6,700 people, so a quarter of the full-time employees working at the company are restructuring. For reference, the total number of Uber employees was 26,900 as of the end of 2019.

Uber was hit by Corona 19, and the car-sharing division, a core service, is in serious condition, with sales in April dropping by 80% compared to the previous year. CEO Dara Kosroshahi said that in view of the dramatic impact and unpredictability of recovery from the Corona 19 epidemic, Uber’s mobility and delivery platform have changed the size of the company to match the realities of the flagship business.

Therefore, corporate restructuring is underway, and as previously stated, 3,700 people from the Customer Support Department decided to layoff and this time, an additional 3,000 people were leaving the company with announcing that it would close 45 offices.

Not only that, Uber is also in the process of consolidating its business, including the abolition of the Uber Incubator, which started in September last year. Of course, in the case of the Advanced Technologies Group, which develops autonomous driving programs, some of its employees have been fired, but they will continue. CEO Dara Kosroshahi emphasizes that he has always made long-term investments in the development of autonomous vehicles. Of course, CEO Dara Kosroshahi has also agreed to return his basic money this year.

Of course, while the ride-sharing service has been hit hard, Uber’s food delivery service, Uber Eats, is growing rapidly as the world suffers from COVID-19. Uberit’s reservations increased 54% over the previous year. However, the problem is that it is not enough to compensate for the serious losses incurred from car sharing, the main service.

In an email sent to an employee, CEO Dara Kosroshahi said that he tried to provide sincere support for those leaving Uber such as strong retirement allowance, medical insurance, and retiree skills development. Insisted. Uber plans to spend $110 million to $140 million in the second-quarter layoff package and $65 million to $80 million with office closures. In order to retain key business functions despite difficult circumstances, Uber’s board of directors has decided not to receive full cash benefits in 2020.

Not only Uber, but also shared services companies such as Rift and Airbnb are facing a similar situation. Rift announced that it would fire 1,000 people, or 17% of its total employees. Airbnb has already fired 25% of its employees. It is attracting attention to what extent companies that have lost numerous employees, including Uber, can reorganize in the future. Related information can be found here .