The California-based online payments system Paypal has announced that economic conditions have left the company with little choice but to contract its workforce.
The cuts, which will take place over the coming weeks, will affect 2,000 full-time workers, but the financial technology company has not elaborated further to confirm which of Paypal’s divisions will suffer cuts.
Citing the “macro-economic environment” in a statement released to employees Tuesday, CEO Dan Schulman expressed gratitude to the workers who would be leaving his team. “I want to express my personal appreciation for the meaningful contributions they have made to PayPal,” he said. Schulman went on to explain that those who will no longer be staying on will receive “generous packages,” consultation, and support during their transition from the company.
The technology sector has suffered an immense series of layoffs this year, and entrepreneur Roger Lee, who has worked in the industry since he was a teenager, has compiled a database of companies that have laid off employees since the start of the COVID-19 pandemic.
Lee, who hosts his research on his website Layoffs.fyi, has already logged over 241 layoff announcements just one month into 2023, amounting to a total of 77,916 terminated positions.
Some industry observers have questioned whether the layoffs are truly a response to economic conditions, suggesting that more business-oriented decision-making was taking place behind the scenes. Writing for Forbes, futurist Bernard Marr noted that while Microsoft eliminated 10,000 positions recently, money did not seem to be the deciding factor:
Microsoft, which is reported to have laid off around 10,000 employees, practically simultaneously announced that it plans to invest $10 billion in OpenAI, the creators of the viral application ChatGPT. It seems likely that there is a business reason at the heart of the decision to invest a sum that would equate to $1 million per laid-off employee in an AI company.
Still, not every tech sector employee has succumbed to economic and environmental factors. A number of key players in the industry have maintained their workforce levels and refrained from large layoffs — at least over a period of the last six months — but of the Big Five (Meta, Microsoft, Alphabet, Amazon, and Apple) only the technology giant founded by Steve Jobs has managed to avoid taking an axe to their payroll.