The music streaming giant is the latest tech organization to see job cuts
Yet another tech giant has announced layoffs in the face of economic uncertainty. Music streaming platform Spotify will be laying off six percent of their global workforce, CEO Daniel Ek announced today, impacting around 600 employees.
In a staff memo posted this morning, Ek cited “speed” as the company’s best defense strategy – adding that efficiency will be key to their long-term success.
“Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk to the impact of a slowdown in ads would insulate us,” writes Ek.
“In hindsight, I was too ambitious in investing ahead of our revenue growth. And for this reason, today, we are reducing our employee base by about six percent across the company. I take full accountability for the moves that got us here today.”
Ek confirmed that affected employees, or “bandmates”, will be eligible for a baseline severance pay of approximately five months, all unused vacation days, healthcare during the severance period and career support for outplacement services.
“We’ve come a long way in our efforts to build a comprehensive platform for creators of all levels, but there’s still much to be done,” writes Ek. “To truly become the go-to destination for creators, we need to keep improving our tools and technology, explore new ways to help creators engage with their audiences, grow their careers, and monetize their work.”
And it’s almost the same story on repeat at this point. The tech sector, one that was quick to hire in the past year, is seeing hit after hit in downsizing – with Amazon, Microsoft and Salesforce all announcing layoffs recently.
Writing in his own online memo, CEO Andy Jassy said more than 18,000 roles will be eliminated – more than the original 10,000 reported late last year.
“These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles,” writes Jassy.
“Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year.”