In a new filing to the Securities Exchange Commission, Uber has revealed it will be retrenching 3,700 of its full-time employees. This represents about 14 percent of its workforce of nearly 27,000 people. Since people aren’t traveling nearly as much during the lockdown and quarantine phases in countries around the world, demand has dropped significantly.
“Due to lower trip volumes in its Rides segment and the Company’s current hiring freeze, the Company is reducing its customer support and recruiting teams by approximately 3,700 full-time employee roles,” Uber wrote in its filing.
We saw similar moves from its biggest competitor Lyft (letting go of 17 percent of its staff), and more recently Airbnb also announced big retrenchments (about 25 percent of its staff) due to the low demand of traveling customers.
In a sign of support to the business and other employees, Uber CEO Dara Khosrowshahi decided to forego his salary of $1 million for the rest of the year. Of course, most of his compensation comes from bonuses and stock allocations.
Uber has recently announced new technology that will endure that drivers and riders wear masks in response to the COVID-19 outbreak. It has also reconfigured its platform to allow for deliveries of goods other than just food from the Uber Eats service. For example, Exclusive Books deliveries are now done through the Uber Eats app in South Africa (use promo code UNLTDZA for free delivery until the end of May).
According to reports from The Information, ride requests on the main Uber app is down by as much as 80 percent. Uber’s stock fell as much as 4% Wednesday as a result of the announcement.
“We are looking at many scenarios and at each and every cost, both variable and fixed, across the company,” Khosrowshahi said. “We want to be smart, to move fast, to retain as many of our great people as we can, and treat everyone with dignity, support and respect.”