Largest Jobs Website Lays Off Thousands Of Employees
It is rather ironic that while the unexpected weekly drop in initial jobless claims highlights the structural shortage of workers in a very tight labor market, internet job-search platform Indeed plans to lay off approximately 2,200 employees, representing 15% of its workforce.
In a blog post, Indeed CEO Chris Hyams expressed that he was "heartbroken to share that I have made the difficult decision to reduce our headcount through layoffs."
"We anticipate we will be letting approximately 2,200 people go. This is roughly 15% of our team. The cuts come from nearly every team, function, level and region at Indeed and Indeed Flex," Hyams wrote.
He warned about mounting macroeconomic headwinds that will dent revenues:
"It is becoming increasingly likely that HR Tech revenue will decline in FY2023 and potentially again in FY2024."
... as with many tech companies, the CEO acknowledges the error of excessive hiring in recent years:
"With future job openings at or below pre-pandemic levels, our organization is simply too big for what lies ahead. We need clarity, focus, and urgency to ensure that all of our energy is directed towards investing in our future. We have held out longer than many other companies, but the revenue trends are undeniable. So I have decided to act now."
The irony of the Indeed layoffs lies in the fact that the labor market continues to be exceptionally tight.
"Found it quite ironic that as we are debating the strength of the labor market Indeed.com (major online us recruitment website) is slashing jobs citing a challenging macroeconomic backdrop," Goldman Sachs analysts told institutional clients Thursday morning.
What's likely happening is that companies are pulling sponsor job listings posts from Indeed as recession threats surge.
We shared with readers early Thursday morning one surprising chart that shows a possible 3-month lag between monetary policy and its effect on the job market.
So, in summary, layoffs at one of the largest job websites in the US might serve as a telling sign of potential turbulence in the job market.