Fears of a recession are growing, and economic uncertainty is impacting delivery businesses. While most gig workers have job security under current plans, office workers are facing redundancy.
While Uber is not concerned about a recession, CEO Dara Khosrowshahi recently told Bloomberg that the company is “recession-resistant”, other delivery companies definitely are worried about the economy.
Here is your comprehensive list of lay-offs in the delivery sector, and what can be taken away from the decisions of the companies.
1. Gorillas lets go of 300 staff
Grocery delivery service Gorillas announced at the end of May that it would be laying off 300 members of its workforce The company has rapidly expanded its headcount in recent years, but since its last round of funding in 2021 (where it raised close to $1 billion) it has run into issues.
In a statement on its website, the company said: “After closing our last funding round in October 2021, we shifted our focus from hyper-growth to a clear path to profitability, which enabled us to increase the efficiency of our business significantly.
“The recent developments in the capital markets confirmed this strategy and proved that we need to reinforce our company’s focus toward profitability.”
The company noted that it would focus on its most profitable markets including Germany, France, the UK, Netherlands, and the US. These markets currently contribute to 90% of Gorillas’ revenue.
As a result of this change in focus, 300 employees from its global offices have been made redundant.
Gorillas concluded: “While this was an extremely hard decision to make, these are necessary moves that will help Gorillas to become a stronger and more profitable business with a sharpened focus on its customers and its brand.
“With our current investments, we are strengthening our position both financially and strategically for the future.
“We are extremely proud and grateful for what our teams have achieved over the last two years and we will do everything we can to support our employees in this transitional phase.”
2. JustEat scales back
Another company that is reducing its workforce is JustEat Takeaway. The company has reduced its operations in France and will be laying off 390 jobs from its workforce in the country as it attempts to improve profits after an 84% economic downturn in the country.
In a statement to TechCrunch, a spokesperson for the organization said: “Due to the challenging market dynamics in France and our ambition for sustainable profitable growth, we have the intention to restructure our operations in France.
“The strategic restructuring will consist of redundancies of staff in the Paris office and changes in the operations of our delivery business”
The layoffs had an immediate effect as the stock price of the company jumped nearly 10%. However, at the time of writing, the company has not released a statement on the layoffs
Despite this, it is clear that JustEat needs to change the tide when it comes to profits in France.
3. Getir sacks 14% of staff
Turkish delivery service Getir told its 6,000 members of staff that it intended to lay off 14% of them. The company has not confirmed exactly how many will be fired and which teams will be impacted.
In a statement to TechCrunch, the employer said: “Today is one of the most difficult days since we founded Getir because we have to make tough decisions about our people organization that will adversely affect some of our team members.
“Rising inflation and the deteriorating macroeconomic outlook around the world pushes all companies, especially in the tech industry and including Getir, to adjust to the new climate.”
“The numbers of those fired will be different depending on the country. The company noted that this has been a difficult decision but “there is no change in Getir’s plans to serve in the nine countries it operates”.
Getir will also pause hires and costly promotions in response to macroeconomic conditions.
The issues that have led to redundancies for all of these delivery companies are nuanced, but the common theme is that profits are not moving in a direction initially expected.
Going forward, companies need to be mindful of hiring too quickly as economic uncertainty looms. Whatsmore they need to commit to growth in regions or do the best with what they have, rather than removing hundreds of jobs after profit downturns.
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