Ride-share technology company Lyft said it’s cutting 13% of staff, or nearly 700 jobs, to reduce costs and get ahead of choppy economic conditions, the Wall Street Journal reported.
“There are several challenges playing out across the economy. We’re facing a probable recession sometime in the next year and ride-share insurance costs are going up,” Lyft co-founders John Zimmer and Logan Green wrote in a memo.
“We worked hard to bring down costs this summer: we slowed, then froze hiring; cut spending; and paused less-critical initiatives. Still, Lyft has to become leaner, which requires us to part with incredible team members,” they added.
The ride-hailing company has more than 5,000 employees, which don’t include its drivers. Lyft laid off 60 people, or under 2% of its workforce, in July. In May, it said it planned to slow hiring and reduce the budgets of some of its departments.
Technology companies large and small have been announcing hiring freezes or staffing cuts this year after many hired at a breakneck speed through the pandemic and now confront a tougher economic outlook. This week, Amazon.com Inc. told employees it is pausing corporate hiring and payments startup Stripe Inc. said Thursday that it is laying off about 14% of its employees. Both blamed the harsh economic climate for their decisions.
San Francisco-based Lyft also said that it would sell its vehicle service centers and that most of that team is expected to receive roles from the acquiring company, which it didn’t name. Lyft has centers in nine markets.
Employers Testing Limits of NYC Pay Transparency Law
The law requires a “good faith” attempt at providing a salary range, but that language leaves room for some interpretation. HR Dive found that PwC, for example, advertised an account executive position paying $116,000 to $268,000 — a more than $160,000 span.
A job listing for a New York Post sports reporter offered a range of $15 per hour ($31,200 annually, assuming a 40-hour workweek) to $125,000 annually.
In its ad, the Post said its ranges “reflect our good faith estimate to pay fairly as to what our ideal candidates are likely to expect, and we tailor our offers within the range based on the selected candidate’s experience, industry knowledge, technical and communication skills, and other factors that may prove relevant during the interview process.”
In another listing with a nearly $100,000 difference between minimum and maximum salaries, Citigroup advertised a client service officer role for $61,710 to $155,290. That range was posted after Twitter users initially pointed out a $0 to $2 million advertised range.
U.S. Economy Added 261,000 Jobs in October
The U.S. added 261,000 jobs in October, according to the jobs report released on Friday by the Department of Labor.
The gains outpaced economists’ projections of 195,000 jobs and the report also revealed that September’s payroll reading was upwardly revised to 315,000 from 263,000. The unemployment rate rose to 3.7% and average hourly earnings grew 0.4% month-over-month, which represents a 4.7% year-over-year increase.
Employment data has moderated in recent months, but hiring remained strong in October despite efforts by the Federal Reserve to tamp down an extraordinarily tight labor market that has placed upward pressure on wages and contributed to decades-high inflation.
“The bottom line here is that the labor market is softening, but has not yet reached the point where the data are screaming at the Fed to stop tightening,” Pantheon Macroeconomics Chief Economist Ian Shepherdson wrote in a note to Yahoo! Finance. “But if these trends continue, as we expect, markets will start to push the Fed — and especially Chair Powell — to rethink the idea of continued hikes next year.”
Friday's figure effectively serves as a catalyst for Fed policymakers to proceed with further rate hikes, particularly after messaging from Fed Chair Jerome Powell on Wednesday that indicated slight moderations in the data were not enough for a pause on increases given the tight labor conditions.
“Although job vacancies have moved below their highs and the pace of job gains has slowed from earlier in the year, the labor market continues to be out of balance, with demand substantially exceeding the supply of available workers,” Powell said on Wednesday when addressing reporters after the FOMC delivered another 0.75% rate increase.
LinkedIn Data Indicates Less Flexible Work Arrangements Are Available
The number of remote job postings on LinkedIn are falling, according to new data released by the platform. In the U.S., for example, the share of postings with remote roles has declined by 5 percentage points since April, when they peaked at 20% of postings.
While this is still much higher than the pre-pandemic average of 2%, it is a stark contrast to what employees want, Josh Graff, managing director for the EMEA and LATAM regions at LinkedIn, told CNBC Make It.
“Professionals now value flexibility in the workplace very highly — it consistently lists among the most important priorities for employees after compensation, along with skills development and work-life balance,” he said.
Despite the drop in remote working jobs in the U.S., these postings are still receiving over half of the total applications as of September, LinkedIn’s data shows.
The research shows that countries around the world follow a similar pattern — in the U.K., remote jobs make up 14.6% of opportunities, but receive 20.2% of total applications, and in India, the 11.3% of available remote roles are being sent 20.3% of resumes.
According to a survey released by LinkedIn alongside the data on remote job opportunities, the shift away from them is linked to the current economic situation.
Sixty-eight percent of executives surveyed said they were concerned that the ongoing uncertainty about economic stability and a looming recession would force their companies to undo at least some of the progress made toward flexible working during the coronavirus pandemic.
“Around the world we’re seeing hiring slow and companies freeze recruitment due to economic uncertainty, with business leaders under intense pressure to manage costs and boost productivity,” Graff said. “Where the pandemic led to a shift towards flexible working and initiatives to support employees, the balance of power is now shifting back to employers.”
Flexible working is not the only employee perk being hit by the current economic turmoil, the survey found. Seventy-four percent of executives said skills development may have to take a backseat, while 75% said employee well-being would likely be less of a priority.
Close to 3,000 C-level executives at companies with at least 1,000 employees and with a minimum annual turnover of at least £250 million ($288.3 million) were surveyed by YouGov on behalf of LinkedIn to gather these insights.
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