WeWork said it would start laying off workers in the US this week. The struggling office-sharing start-up is trying to stabilise its business at a time of heavy losses. Marcelo Claure, the company’s executive chairman, told employees in an email Monday that the process “will make us stronger and more capable of creating more opportunities in the months and years ahead.”
Shortly after the initial public offering was withdrawn in September, WeWork told employees to be prepared for mass layoffs. People familiar with the matter said the total number of job cuts could be about 2,000, or about 16 percent of the world’s workforce.
Mr. Crower said he plans to brief employees on the company’s future on Friday, when he will sort out WeWork’s five-year plan.
After the company’s valuation plummeted from $47bn to about $8bn, WeWork is looking to cut costs and show a way to make a profit to try another IPO next year. This road includes asset sales and layoffs.
WeWork employees are used to routine dismissals. WeWork said the nine-year-old company would make regular layoffs to eliminate underperforming employees. The company laid off hundreds of employees in 2016 and held an employee meeting to discuss the move. This spring, WeWork laid off about 300 more employees.
WeWork employees are preparing for layoffs and start organizing spontaneously. Two weeks ago, some employees sent a letter to management asking for changes, such as greater pay transparency, greater employee involvement in management decisions, and an end to mandatory arbitration.