Despite stable business growth and increased revenue, Uber has decided to lay off approximately 3,300 employees. This reduction accounts for about 10% of the company's total global workforce.
The reason for this large-scale decision is Uber's drive to operate faster and more efficiently. This was announced by CEO Dara Khosrowshahi in a memo sent to employees.
Over the past five years, Uber has significantly expanded its operations, launching numerous new products and scaling up the company. However, growth brought a problem: the increase in company size led to an increase in management layers and teams.
This, in turn, slowed down the decision-making process. The number of meetings and the need for coordination between different teams increased, as did ambiguity in the distribution of job responsibilities. According to the CEO, employees were spending more time coordinating actions than actually working. To resolve this issue, Uber decided to cut about 3,300 jobs.
The company particularly reduced several management levels. The number of employees working seven or more levels below the CEO was decreased by 20%. Additionally, the number of small teams consisting of only one or two people was cut by roughly half.
In the future, Uber is placing a major bet on the autonomous, or self-driving, vehicle business. The company recognizes that the robotaxi market can grow rapidly. Therefore, Uber intends to direct its resources and funds toward developing this new technology.
The company's plan is to reduce costs where a large number of people and management are not required, and to invest the freed-up resources in future technologies. The company stated that these changes will allow potential to be directed towards growth, innovation, and an autonomous future.
In addition to the layoffs, Uber made significant changes to its remote work policy. Going forward, only about 1% of the company's employees will be able to work fully remotely. Most staff will have to perform their duties in the office, and the company will maintain its hybrid policy, which requires three days in the office.
It is important to note that the Uber CEO did not directly link the layoffs to the influence of artificial intelligence. He emphasized that the company had become too complex and now needed to become more compact and agile. Nevertheless, the influence of AI may appear in the future, as the rapid growth of robotaxis will require a serious overhaul of Uber's business model.