OLX to layoff 1500 employees: what does it mean for the tech industry
OLX, a Dutch-owned company, has announced that the company will go through a restructuring process that will affect 15 percent of the total headcounts globally. The company announced that it would layoff 15 percent or 1500 employees. OLX is the recent company that has joined the list of global firms around the world undergoing massive layoffs.
The company spokesperson has talked to valid sources confirming the decision. He has stated that OLX is cutting its global workforce by 15 percent. The layoffs will impact the staff from different countries serving different roles in the firm. In response to the restructuring process, he has further asserted that the company is taking necessary measures to overcome the massive restructuring process.
In addition, he shared his apologies, stating that OLX is presently reducing the size of the workforce. And, it is a tough decision for the company to part ways with such valuable contributors. But, the step is necessary to meet the future goals laid down by the company. The main objective of the company is to ensure that the employees are treated fairly and with due respect.
It has not been yet disclosed about the number of employees in OLX has been impacted in India. But, information has revealed that the most impacted sector is the engineering and operations team.
OLX opened its branch in India in 2009. The Amsterdam-based company also deals with OLX and OLX Autos.
The company initiated its global operations in 2006 and has nearly 20 brands around the globe. The company has expanded to five continents in a short duration. It enables users to buy and sell goods across various categories, such as fashion, electronics, transport, furniture, and many others.
Apart from OLX, many other prominent companies around the globe, such as Amazon, Goldman Sachs, and McDonald’s have or will experience major layoffs in the next couple of months. On January 5, the e-commerce platform announced that it would lay off 18000 employees, which accounts for 3 percent of the total workforce of the company.
At the same time, the U.S. business software maker company named Salesforce had decided to cut off 10 percent or 8000 employees of its total workforce. After a holiday period, it can be predicted that more layoffs are yet to occur, and several companies in the spectrum, influenced by the tech companies will let go of thousands of employees globally.
The major reasons for layoffs can not be summed up for all industries, but few definitive reasons can be drawn to interpret the reasons behind the massive layoffs in the tech industry.
Major reasons for layoffs in the tech sector:
In many ways, it can be mentioned that the recent rounds of layoffs are trying to rectify a previous mistake. During the pandemic, the world became centered on online sites. At the time, online shopping has become a prime retail outlet. Netflix, Amazon Prime, and various other streaming platforms replaced the cinemas and various other leisure activities that one did while not being restricted to the four walls of his residence.
Despite covid-19 being a global crisis, it has been an advantage for many tech companies. They have achieved higher rates of revenue, which in turn created increasing profits and resulted in a hiring drive to keep the business. It meant that the candidates were offered bigger benefits.
Many tech companies have anticipated that this was the start of a new situation, but the normalization of the pandemic has caused gradual yet massive changes in the lives of the people. Because they considered a shift was bound to happen, the tech companies hired accordingly. When the fruit did not turn out as expected, the companies were in deep turmoil.
Secondly, the layoffs have been driven mostly by the macroeconomic situation and a potential recession.
The macroeconomic condition could not have impacted layoffs if the growth prospects were fair in the tech industry. The main problem is that the short-term future does not seem muchly favorable. It has been all over the news that the U.S. is most likely to be on the path of recession. A potential recession implies a decrease in consumer spending and a decline in advertising revenues for tech companies. It is one of the crucial reasons why prominent and giant tech companies like Meta, and Twitter had to undergo a restructuring process.
With these headwinds, it can be concluded that layoffs are yet to worsen shortly, and OLX has just joined the bandwagon.
edited and proofread by nikita sharma