With the pandemic and related restrictions imposed by nations across the world, the demand for app-based rides fell drastically over the last couple of months. This has driven Uber, the American multinational ride-hailing company to let go of about 3,700 full-time employees, that is, 14 per cent of its workforce. Dara Khosrowshahi, CEO, Uber Technologies, will be foregoing his base salary for the rest of 2020.
Members of Uber’s customer support and hiring teams will be most affected by this round of layoffs. This is because, hiring has been frozen, and there is hardly any work for recruiters. Also, with demand for rides dropping, the community operations division that provides personal support to customers has no work left either.
About 40 per cent of Uber’s Greenlight locations, that are used for in-person driver assistance, will also be closed. The Company is expected to suffer a loss of approx. $20 million on account of severance packages and related payouts.
The Company is offering about 14 days of financial support to drivers and delivery workers who have tested positive for COVID-19 or quarantined.
Uber’s subsidiary business in the Middle East, Careem, is also laying off about 536 employees, that is, almost 31 per cent of the workforce.
Lyft, a rival ride-sharing company based in San Francisco, had announced its decision to slash more than 900 jobs in April, that is about 17 per cent of its staff, as it was finding it difficult to stay afloat. It is estimated that Lyft would be shelling about $28 million to $36 million on severance packages and benefits.