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DoorDash, the American online food ordering company, revealed its plans to let go part of its workforce last week. It said that it would have to lay off around 1,250 corporate employees, and in new updates, some people were terminated already.
As per CNN Business, the company’s chief executive officer, Tony Xu, personally informed the staff about the layoffs by sending them a memo. He told them that the move to fire people is “the most difficult change to DoorDash that I have had to announce in our almost 10-year history.”
It was suggested that the job cuts were partly due to the hiring during the pandemic. It expanded its team too quickly at that time, and now that things are going back to normal, DoorDash may have realized it does not need that many people to operate.
The company is the latest major brand in the U.S. to announce layoffs in recent weeks. DoorDash’s spokesperson said that the number of people who will lose their jobs is equivalent to around six percent of the company’s total number of employees.
Apparently, DoorDash is one of those firms that experienced a pandemic boom as more people turned to online deliveries for food and essentials since everyone has been staying home due to COVID-19 restrictions or people have simply refused to go out for fear of catching the virus.
As a result, a wave of layoffs is sweeping the tech industries' giants such as Amazon, Twitter, and Meta have been terminating thousands of jobs. On top of the pandemic boom, rising inflation is another thing to blame for the cuts. Many companies admitted they have misinterpreted the high demands during the pandemic, which resulted in mass hirings at that time.
“Our business has been more resilient than other e-commerce companies, but we too are not immune to the external challenges and growth has tapered vs our pandemic growth rates,” the DoorDash chief said in a message to employees. “While our business continues to grow fast, given how quickly we hired, our operating expenses – if left unabated – would continue to outgrow our revenue.”
Xu also apologized to those who will lose their jobs and said, “I did not take this decision lightly. We have and will continue to reduce our non-headcount operating expenses but that alone would not close the gap and this hard reality ultimately led me to make this painful decision to reduce our team size.”
Photo by: Marques Thomas/Unsplash
