Uber Lays Off 3,700 Workers amid COVID-19 Pandemic

Uber will be firing 3,700 employees and also shutting down 180 driver centers around the world

The company had to take this decision due to the bad decline in ride-hailing businesses because of the ongoing pandemic. Uber relayed this decision in a SEC filing by the company. The document states that the company intends to fire 14% of its total workforce while stating that they have to do this in order to reduce their operating expenses.

Dara Khosrowshahi, the CEO of Uber said in an email to the employees that; “With the reality of our rides trips volumes being down significantly, our need for CommOps as well as in-person support is down substantially and with our hiring freeze, there simply isn’t enough work for recruiters.”

The CEO further clarified that the downsizing will affect mainly those in support and recruiting sections of the company.

Apart from laying off its staff, Uber would also be shutting down 180 out of the 450 “Greenlight Hubs” it has globally. Greenlight Hubs are the drive centers of Uber and they serve as hubs where interested drivers can sign up. These drivers can also learn how to use the app at these centers. In addition, they also receive assistance on issues that arises from the job at these driver centers.

EFFECT OF THE PANDEMIC ON RIDE-HAILING BUSINESSES

The global pandemic has forced most governments worldwide to declare a compulsory stay-at-home for its citizens. Since ride-hailing services are dependent on the people’s movement, the businesses have been suffering badly.

ALSO READ: Airbnb Terminated the Employment of 1900 Employees

In Nigeria for example, the states that are the businesses major market have been on total lock-down. As a result of this lockdown, Uber, and Bolt which are the major ride-hailing companies have been shut down.

Earlier in March, Uber introduced a freeze on hiring and also withdrew its financial forecast. The company had to also close down its food delivery operations in seven different countries.

The CEO of Uber has also made a sacrifice to help the economic situation of the company. He has waived his remaining salary for the year for the company. Findings show that he was eligible for a salary of $1 million and a bonus of $2 million in 2019.

Bolt which is Uber’s rival has also been affected and this week, the company had to pivot in the delivery service business. The company did this in a bid to find alternative sources of income to cover up for the decline in the ride-hailing service.

Sadly, the pandemic doesn’t seem like it would end soon and this would mean that the ride-hailing businesses would keep declining.

According to Bloomberg, the firing of these staff and shut down of drive centers is just the beginning. This is due to the fact that the company intends to employ a series of cost-cutting measures over the next two weeks.

 

 

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