Flexport, an online retail logistics company, has announced plans to cut approximately 1,200 jobs, accounting for nearly 2% of its total workforce. This comes as part of the company‘s strategy to transition into its “next phase of growth.” Earlier this year, Flexport had already laid off around 15 employees following statements from CEO Chris Caren, who indicated that the company could reduce its headcount by 20% due to advancements in artificial intelligence (AI). The recent announcement marks the second round of layoffs for Flexport this year, with the company previously cutting 20% of its staff in January.
The reduction in workforce is not limited to Flexport alone. The logistics company has reportedly slashed at least 5% of its marketing and recruiting staff and eliminated 38% of its workforce on January 8. These measures follow a series of layoffs conducted in September 2023. Flexport's decisions are reflective of a broader trend in the tech industry, where companies are increasingly leveraging AI to streamline operations and reduce costs.
In addition to Flexport, several other companies have undertaken significant layoffs. A cybersecurity company recently raised $60 million at a $1 billion valuation, achieving unicorn status. Meanwhile, Sonos, which reduced its headcount by 7% in 2023, and a 3D printing firm that cut 40 employees over the past two years, are examples of firms adapting to changing market dynamics. The online ticketing company made headlines earlier this year when it let go of 8% of its employees in February 2023.
The fast-delivery startup, aiming to become cash-flow positive by the end of 2024, eliminated 6% of its staff in another layoff round. Moreover, the company confirmed it cut 10% of its contractor workforce at the end of 2023 as it embraces AI to enhance content production and translations previously managed by humans.
India's largest conglomerate, Reliance, took a more gradual approach but ultimately announced it had laid off more than 42,000 employees in its fiscal year ending in March. This revelation underscores the global trend of workforce optimization driven by technological advancements.
Looking ahead to 2024, Flexport expects to cut an additional 1,500 roles primarily within its Product & Technology division. This move will account for more than 8% of the company's workforce. As companies navigate these turbulent times, they continue to explore innovative solutions to remain competitive and sustainable.
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