Airbnb is laying off 25% of its global workforce as the coronavirus continues to hurt the travel and hospitality industry.
- CEO Brian Chesky said Tuesday San Francisco-based Airbnb is cutting 1,900 jobs in, which amounts to 25% of its 7,500 person global workforce.
- U.S. employees will get 14 weeks of base pay, plus one additional week for every year at Airbnb as severance.
- Airbnb’s business has been strained because of the coronavirus, with revenue in 2020 forecasted to be less than half of what the company earned last year.
- Chesky said he doesn’t know when or if normal travel will return, which contributed to the decision to cut jobs, even though the company raised an additional $2 billion in April to keep the business afloat.
- Airbnb is refocusing the company on its core home sharing business and pausing its efforts on transportation as well as Airbnb Studios, which produces travel videos.
- The company is also scaling back investments in Lux, the company’s luxury rental business.
“While we know Airbnb’s business will fully recover, the changes it will undergo are not temporary or short-lived. Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy,” CEO Brian Chesky said in a blog post announcing the layoffs.
The travel and hospitality industry has been particularly hard hit by the coronavirus as countries around the world block travel from certain countries and advise citizens against leaving their home. Airlines, airports, hotels and other Silicon Valley startups have also had to lay off workers amid plummeting demand. Airbnb hosts, too, are under economic strain as bookings go down to practically zero.