Uber lays off 3,000 more people

Ride-share company also eliminates 45 offices

Uber has lost 25 per cent of its employees since the start of the coronavirus pandemic (Getty)

Uber has announced it will be laying off an additional 3,000 employees as the coronavirus pandemic decreases demand for the company’s services.

The company initially announced it would be laying off 3,700 staff members after Covid-19 started to make its toll on the ride-share industry. But more cuts would happen, Uber announced Monday.

Now the company has lost 25 per cent of its employees since the start of the pandemic.

Uber’s Chief Executive Dara Khosrowshahi made the announcement in an email to employees. It also detailed how 45 offices would be closed in addition to the 3,000 jobs eliminated. Uber drivers are not considered employees under the ride-share app, so their employment was not impacted.

In April when a majority of Americans were under stay-at-home orders, the company found rides were down 80 per cent compared to the previous year.

“Given the dramatic impact of the pandemic, and the unpredictable nature of any eventual recovery, we are concentrating our efforts on our core mobility and delivery platforms and resizing our company to match the realities of our business,” Mr Khosrowshahi said in a statement.

“That’s led us to some painful decisions today: we are stopping some of our non-core investments and reducing the size of our workforce by around 3,000 people, each of whom I want to personally thank for their contributions to Uber. As I said to our teams today, we are making these hard choices now so that we can move forward and begin to build again with confidence.”

The ride-share portion of Uber makes up about 75 per cent of the company profits, so that area taking a hit during the pandemic has greatly impacted the overall revenue.

Uber Eats, in comparison, was the bright spot amid the pandemic because of its increased demand, but “the business today doesn’t come close to covering our expenses”, Mr Khosrowshahi said.

Uber has reportedly been in talks to buy rival Grubhub, another food delivery service, according to The Wall Street Journal. The purchase of the delivery service could help boost revenue for Uber, but there was no mention of the potential deal in the memo emailed out to employees.

Other competitors in the ride-share industry have also seen a decline in revenue as more Americans are staying at home instead of travelling.

Lyft, Uber’s top rival, has cut 17 per cent of its staff because of Covid-19.