Tech giants Uber and Airbnb make sweeping job cuts

Global tech firms Airbnb and Uber have announced major job cuts in the past 24 hours.

Uber has said it is to cut 3,700 jobs around the world as lockdowns take their toll on bookings. The firm’s cuts will mostly affect customer support and recruiting teams, the company said. It added it expected to incur a $20m cost for severance payments.

Uber also said in a stock market filing that chief executive officer Dara Khosrowshahi would waive his base salary for the remainder of the year.

An Uber staff memo written by Khosrowshahi seen and reported on by the Financial Times warned that additional cuts were likely to be made in coming weeks as the company made “difficult adjustments” to match “the reality of our business”. He told staff: “We are looking at many scenarios and at each and every cost, both variable and fixed, across the company.”

Details are scant about how the cuts will fall in various countries but Uber said it would close more than a third of its 450 Greenlight Hubs. These are places where the company’s drivers are given assistance in signing up to the app and other related needs.

Meanwhile, accommodation giant Airbnb has revealed it is to lay off 1,900 workers, 25% of its 7,500 workforce.

Airbnb CEO and co-founder Brian Chesky said the layoffs would affect a number of internal product groups, including Transportation and Airbnb Studios, and more niche, upmarket Hotels and Lux initiatives, which would be scaled back.

The company has employees in 24 countries and did have plans to float on the stock market this year, which have ow been jettisoned. Its most important HQs are in San Francisco and Dublin, where 500 people are employed. As with Uber, there are no details about the geographic distribution of the job cuts.

Airbnb’s projected $40bn-plus flotation was set to earn many of its staff large payouts, because early entrants into the company were partly remunerated in stock options.

US companies laid off more than 20 million workers in April, far exceeding the previous record of 835k set in 2008. More than 16 million jobs were lost at service sector companies, with hospitality and leisure worst hit, as in the UK.