The novel coronavirus has started taking a toll on businesses and jobs. The impact on the global economy is already being estimated as being far more severe than we saw during the global recession of 2008. By the looks of it, and as per industry experts we’re already amidst an unemployment crisis, which is expected to amplify further, even after the containment of the virus.
Several industries have already started feeling the heat of the pandemic. Industries like travel, hospitality, and airlines are already in soup. The International Labour Organization, a UN agency has already estimated that because of the pandemic, the world will witness a loss of about 25mn jobs. Most of these job losses will come from these industries, however, every sector is expected to face the heat, as companies scramble to save cash, and are cutting their spending to ensure the continuity and survival of their business.
Recently, online hiring marketplace ZipRecruiter Inc, cut back about one-third of its workforce to save cash burn amid the pandemic. According to various sources, the Santa Monica-based ZipRecruiter notified hundreds of its employees via Zoom calls, about layoffs and furloughs. A major layoff by a well-known recruitment platform makes the existing and impeding job and unemployment crisis quite evident.
The company has assured its affected employees that they will receive one month of severance, three months of company-paid healthcare insurance coverage and a two-year extension to exercise equity.
It is also being reported that other than downsizing, ZipRecruiter also slashed its marketing budget and overall expenses by $10mn per month. CEO Ian Siegel and his three co-founders took a 50% salary reduction, with other executives also taking pay cuts.
“[There has been] a pronounced reduction in hiring activity over the past couple weeks,” the company said. “As a result of this decline in economic activity, ZipRecruiter came to the difficult decision to furlough or lay off 492 employees (39% of the total headcount) on Friday. These actions are in no way a reflection of the incredible contributions these valued team members made to ZipRecruiter.”
What is ironic about this recent development is the fact that downsizing follows ZipRecruiter’s recent claim that business is better than ever. According to data from the employment marketplace, Americans suddenly find themselves depending more than ever on technology platforms for work and entertainment, listings for temporary tech jobs rose through the end of February into March.
In a The Times report, ZipRecruiter labor economist Julia Pollak, earlier this week has been quoted as saying – “Tech companies are seeing a surge in demand for their services and their technologies“, “they’re seeing kinds of demand that they really didn’t plan for”.
ZipRecruiter, an employment marketplace connecting job seekers and employers was founded in 2010. The company was valued at $ 1.5 billion, in its most recent funding round ( Oct 2018).
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