Salesforce has now joined the growing list of big tech companies laying off their employees as they are unable to cater to everyone.
The company has announced that it will let go of about 10% of its workforce or 7,000 jobs while it will also shut off some offices in certain markets.
The company made its decision known via an email to its employees while also filing with the SEC. The company’s CEO, Marc Benioff stated that the company’s challenging environment in which it operates has affected its business operations as well as its customers now taking a more measured approach before making their purchasing decisions.
Benioff admitted his company had hired too many people during the pandemic. The company had a huge 30% employee increase by 2020. The company said its workforce had grown to 79,000 by 2020.
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“I’ve been thinking a lot about how we came to this moment,” Benioff wrote. “As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”
As part of a severance package, Benioff also said those impacted in the US will receive a minimum of about 5 months’ worth of pay and health insurance among other benefits to help them transition. On the other hand, those outside of the US will have a similar level of support.
One of the many reasons the company is also seeing a bad time is due to a new investor which is said to seeking a cost-cutting measure as part of its investment.
The previous round of layoffs back in November affected hundreds of employees with the likes of the company’s co-CEO and co-Chair Bret Taylor stepping down from his roles.
Other big tech companies affected by the state of the economy include the likes of Meta which cut 13% of its workforce, Stripe doing 14% of its workforce and Tesla is said to be gearing up for a fresh wave of redundancies.
Amazon on the other hand is said to have secured an US$8 billion loan in order to easily tackle the uncertain macroeconomic environment.
As with just about every other tech company, Salesforce has been facing significant headwinds too.
As for Salesforce, the company said its restructuring effort will cost it between US$1.4 billion and US$2.1 billion which it’s expected to incur in Q4 of fiscal 2023.
