Lyft is laying off 13% of its employees due to the looming recession in 2023 and rising cost of ride-hailing insurance. In its announcement, the company promised to assist affected employees in anyway that it can.
For example, it will work to help them get jobs elsewhere with recruiting assistance efforts. Also, they will receive 10 weeks pay as their severance package and health insurance coverage until April 30, 2023. Employees who have worked with Lyft for more than four years get additional four weeks of pay.
“Lyft has to become leaner, which requires us to part with incredible team members. The layoffs impact every organization in the company,” co-founders Logan Green and John Zimmer said.
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The company said that it was not the first time it attempted to cut costs, and the layoffs was more of a last resort. “We worked hard to bring down costs this summer. We slowed, then froze hiring; cut spending; and paused less-critical initiatives,” it stated.
Those efforts did not yield the needed result but it believes that the layoffs would. “We need 2023 to be a period where we can better execute without having to change plans in response to external events. The tough reality is that today’s actions set us up to do that,” it added.
As CNET reports, Lyft has seen its shares fall by 60% in the about one year. It is the latest tech company to show just how much the impending economic troubles are affecting it.
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