Tech’s layoffs and hiring freezes are deepening, as Amazon.com Inc. today announced a pause in new hires and Lyft Inc. and Stripe Inc. said they are laying off hundreds of employees amid the worsening economy.
Amazon, which had previously announced it would freeze hiring for corporate jobs in its retail operation, said today that it will also pause hiring for the same roles throughout the company. Amazon human resources chief Beth Galetti said in a memo today that the company expects to keep the pause in place for “the next few months” and adjust as economic conditions change, though it also said it will replace some employees and continue to “hire people incrementally” in targeted areas.
“We still intend to hire a meaningful number of people in 2023, and remain excited about our significant investments in our larger businesses, as well as newer initiatives like Prime Video, Alexa, Grocery, Kuiper, Zoox and Healthcare,” Galetti wrote.
The move follows Chief Executive Andy Jassy moving quickly to cut expenses in the past few months, shutting down its telehealth service and getting rid of warehouse space.
Meantime, the layoff parade continued. Ride-hailing giant Lyft Inc. said today it will cut 13% of its staff, or about 700 people. “We’re facing a probable recession sometime in the next year and ride-share insurance costs are going up,” Lyft co-founders Logan Green and John Zimmer wrote in the memo viewed by The Wall Street Journal. “We worked hard to bring down costs this summer: we slowed, then froze hiring; cut spending; and paused less-critical initiatives. Still, Lyft has to become leaner, which requires us to part with incredible team members.”
Payments processor Stripe Inc. also announced today it will lay off 14% of its staff, or about 1,000 people, bringing its staff back to the 7,000 it had in February.
“We are facing stubborn inflation, energy shocks, higher interest rates, reduced investment budgets, and sparser startup funding,” Chief Executive Patrick Collison wrote in a memo to employees. “We overhired for the world we’re in…. Stripe is not a discretionary service that customers turn off if budget is squeezed. However, we do need to match the pace of our investments with the realities around us.”
Collison admitted to making a couple of mistakes. “We were much too optimistic about the internet economy’s near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown,” he wrote. “We grew operating costs too quickly. Buoyed by the success we’re seeing in some of our new product areas, we allowed coordination costs to grow and operational inefficiencies to seep in.”
Recent weeks have seen a raft of other companies pause hiring or cut workforces. Just yesterday, Dapper Labs Inc., the developer of CryptoKitties and the nonfungible token market NBA Top Shot, announced it’s laying off 22% of its staff in the wake of the falling NFT market. And Elon Musk is widely reported to be considering big cuts at Twitter Inc. now that his acquisition has been completed.
Others that have laid off employees include Microsoft Corp., DocuSign Inc., Twilio Inc., Robinhood Markets Inc. and Oracle Corp. Companies that have frozen hiring include Google LLC, Apple Inc. and Meta Platforms Inc.
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