HomeTalenteBay becomes latest giant to cut jobs amid consumer downturn

eBay becomes latest giant to cut jobs amid consumer downturn

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Online retailer joins the ranks of Amazon, Spotify and Meta who have had to cut large shares of their workforce in the last year

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E-commerce giant eBay has revealed plans to cut approximately 1,000 jobs, representing around 9% of its full-time workforce.

The move, which also includes a reduction in the use of contractors, is part of a broader strategy to cut costs and streamline operations.

“While we are making progress against our strategy, our overall headcount and expenses have outpaced the growth of our business,” the eBay chief executive, Jamie Iannone, said in a letter to employees.

“To address this, we’re implementing organizational changes that align and consolidate certain teams to improve the end-to-end experience, and better meet the needs of our customers around the world.”

This announcement from eBay is not an isolated incident. It follows a trend of job cuts across the tech sector, with giants such as Amazon, Etsy, Spotify, and Nokia also announcing workforce reductions in recent months.

The reasons behind these cuts are multifaceted, but a common thread is the need for businesses to adapt to a rapidly changing market environment and to ensure their operations are lean and efficient.

In addition to the job cuts, the company will scale back the number of contracts within its “alternative workforce” over the coming months, Iannone added in the note.

“These are not actions we take lightly – and we recognize the impact they will have on all eBayers. We have to say goodbye to people who have made so many important contributions to the eBay community and culture, and this isn’t easy,” he wrote. 

He said that managers at the firm would be notifying employees whose roles had been “eliminated”, and asked all eBay staff to work from home on Wednesday “to provide some space and privacy for these conversations”.

Market trend – employees get the boot

In February 2023, eBay laid of 500 employees globally – 4% of its total workforce. At the time, senior management cited a slowdown in consumer spending following the peak during the pandemic.

But eBay has not been the only one tightening it’s belt in Silicon Valley. Giants including Meta and Google have had to make tough staffing decisions. In March 2023, Mark Zuckerberg revealed plans to cut 10,000 people from the company.

Google’s chief executive Sundar Pichai told staff there could be further cuts at the tech giant as it funnelled more into AI investment. The company cut 12,000 jobs in 2023.

Spotify and Amazon have also cut hundreds of jobs; the latter announced it would cut 17% of its workforce in December 2023, while the former announced jobs would be cut across its streaming platform Twitch earlier this year.

For HR leaders, these developments highlight the importance of agility and adaptability in the current employment market. As businesses strive to stay competitive, HR departments must be prepared to manage workforce reductions with empathy and respect, while also focusing on retaining and developing the talent that remains.

Moreover, these trends underscore the need for HR to be proactive in identifying potential areas of inefficiency within their organizations.

Utilizing HR analytics, as eBay and Dow have done, can provide valuable insights into factors such as attrition rates and the cost of employee turnover. This data-driven approach can help HR leaders make informed decisions and develop strategies that align with their company’s overall business objectives.

While job cuts are undoubtedly challenging for all involved, they also present an opportunity for HR leaders to demonstrate their strategic value. By managing these transitions effectively and using data to inform decision-making, HR can play a crucial role in ensuring their organizations are well-positioned for future success.

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