Like many other tech companies, PayPal plans to let go of a large number of its employees. The payments company said on Tuesday that it was going to lay off about 2,000 people, which is about 7% of its total staff. President and CEO Dan Schulman announced that layoffs would be happening across the company over the next few weeks, with some departments being hit harder than others.
Schulman said, “We will treat our departing colleagues with utmost respect and empathy, provide them with generous packages, engage in consultation where required and support them with their transitions. “I want to express my personal appreciation for the meaningful contributions they have made to PayPal.”
The company’s announcement of layoffs adds to a growing trend among technology firms in recent months.
While Apple Inc. having neither significantly increased its hiring rate nor announced any layoffs, Google, earlier this month, said it was letting-go of 12,000 employees, which is roughly six percent of its global workforce. Microsoft had previously announced it would eliminate 10,000 positions. The most recent, being IBM which its decision saw 3,900 employees (1.5% of its global workforce) laid off, claimed it was associated with asset sales.
The “challenging macro-economic environment” is to blame for the layoffs at PayPal, according to CEO Dan Schulman, who echoed similar statements made by Microsoft and Google executives.
The company has made “substantial progress” in “right-sizing our cost structure” and focusing its resources on “core strategic priorities.”
The US economy has not yet entered a recession, which is something to keep in mind. The unemployment rate in the United States is at a 50-year low of 3.5%, and GDP growth has been seen in each of the past two quarters.
If we focus on PayPal in particular, the company’s most recent earnings call showed that it had increased revenue by 11% year over year and increased profits by 7%, easily surpassing Wall Street’s expectations.
