Slowing business growth and economic recession fears are forcing corporations to find cost-cutting solutions. As a result, the summer of 2022 has become the season of massive nationwide job cuts.
Robinhood, a California-based financial service company, is the latest organization to announce staff cuts. On Tuesday, Robinhood reported that it would be slashing an additional 23% of its workforce. In April, the company laid off 9% of its staff.
CEO Vlad Tenev blamed rising inflation and a drop in user activity. Customers of Robinhood use the platform to buy and sell stocks, but Americans have reduced their trading activity because of recession fears.
Vlad stated in a press release on Tuesday that since the layoffs in April, “we have seen additional deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash. This has further reduced customer trading activity and assets under custody.”
Oracle, a computer technology firm, has also started laying off staff on its marketing, sales, and customer experience teams. While Oracle has not reported the total number of staff it plans to let go, the Independent speculated that it could be thousands.
Shopify was another big name that reduced its workforce. In July, the company dropped 10% of its staff. The CEO of Shopify, Tobi Lutke, explained that the company had previously hired too many people to handle the increase in online shopping activity but that the demand had since slowed.
Ford Motor Co. announced last month that it would focus its efforts on building an electric vehicle fleet. The car manufacturer reported that 8,000 jobs would be cut from its combustion engine automobile division and the funds would be reallocated to electric vehicle production.
Carvana was one of the first companies this summer to reduce its staff. The online car retailer laid off 12% of its workers in May. Tesla followed in July by removing 229 employees from its team.
CEOs everywhere are bracing for an economic recession. Economists at S&P Global Ratings predicted a 2.4% decline in the gross domestic product (GDP) by the end of the year. The Department of Labor reported that 244,000 people filed for unemployment last week, the highest number of applicants in eight months.