In an SEC filing made earlier this week, ride-sharing service Lyft said that it would be making 988 staff members redundant, and 288 would be furloughed.
According to the report, the staff reductions represent a 17% cut to the company‘s workforce. Those that have held on to their jobs will be subject to a 12-week salary cut starting in May. The company‘s executive leadership team will all take a 30% pay cut, vice presidents will take a 20% reduction, and all other employees will see their salaries temporarily reduced by 10%, Lyft said.
Lyft‘s decision to lay off staff to address the economic challenges associated with the drop in rider numbers caused by coronavirus lockdowns is not unique.
Ride-sharing firm and competitor Uber announced a similar SEC filing earlier this week.
Following the resignation of the company‘s CTO and longest serving executive, Uber said that it was discussing cutting 20% of its staff, putting more than 5,000 jobs.
The coronavirus pandemic and associated lockdown measures have caused a drop in user numbers for apps like Uber and Lyft. With that in mind, layoffs and pay cuts shouldn’t come as a surprise.
Research conducted by US automotive industry analysts, CarGurus, found that 39% of people are likely to stop or reduce their use of apps like Uber and Lyft when lockdown measures are lifted.
While times might be challenging for ride-sharing firms right now, that’s unlikely to change any time soon.
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