The coronavirus pandemic has impacted several jobs globally with nearly 10 mn people filing for unemployment benefits in America alone. The pandemic has forced businesses to close operations and employees have been sent on furloughs for indefinite periods. The International Labour Organization has predicted that globally around 2.5mn jobs would be lost due to the pandemic.
Adding to the unemployment crisis, San Francisco-based Opendoor recently announced that it has laid off over 600 of its employees as the company struggles to deal with the economic impact of the pandemic.
“COVID -19 has had an unforeseen impact on public health, the U.S. economy, and housing,” Eric Wu, Chief Executive Officer of Opendoor, said in a statement.
“Given the shelter-in-place guidelines, we’ve seen declines in the number of people buying, selling, and moving during this time of uncertainty. In response, we’ve announced to the company that we’ve made the difficult decision to reduce our team by 35%,” Wu continued. “This was necessary to ensure that we can continue to deliver on our mission and build the experience consumers deserve.”
Wu assured that those who have been laid off will receive eight weeks of pay and reimbursement of 16 weeks of health insurance coverage.
Wu also said he would be donating his 2020 salary to the Opendoor Employee Relief Fund to those who are struggling financially or health-wise due to coronavirus. Other executives will also be contributing to the fund.
“Though this was difficult news to deliver, our focus here at Opendoor remains the same. We continue to work passionately to simplify the customer experience, transform the entire category, and empower millions of homeowners with the freedom to move,” Wu said in the same statement.
The layoffs are the latest in a series of moves by Opendoor to deal with the downturn in the housing market. The company recently paused its homebuying efforts and began canceling pending contracts, leaving some home sellers stranded with two mortgages.
Earlier last year the company had raised $300mn in a capital raise that valued the company at $3.8 billion. The funding came a few months after the company secured a $400mn investment from SoftBank Vision Fund.
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