INDEED plans to cut about 1,000 employees, or roughly 8 per cent of its workforce, the job-search website’s second culling in two years as it seeks to simplify its business in a cooling labour market.
The Austin-based company will concentrate the latest round of cuts in the US with a focus on its research and development and some teams that bring products to customers, chief executive officer Chris Hyams said in a message to employees on Monday (May 13). The unit of Japan’s Recruit Holdings is “significantly restructuring” the R&D team, reducing layers of management and eliminating most of the sales and customer support roles at its site in Foster City, Calif, Hyams said.
The cuts come after Indeed slashed 2,200 positions last year in a bid to trim costs amid slowing revenue. By contrast, the new reductions aim to reduce organisational bloat and speed decision making. The company will also pay out more in severance for “most employees” this time around, Hyams said.
“We are not yet set up for sustainable growth,” Hyams said. “Our organisation is still too complex, we still have significant duplication of effort and too many organisational layers that slow down decision-making.”
US employers last month dialled back hiring while the unemployment rate unexpectedly rose, signs that the labour market may be cooling. Indeed’s move also echoes drives by Meta Platforms and other companies to become less top heavy.
During an internal Q&A, Meta chief executive officer Mark Zuckerberg lamented “managers managing managers, managing managers, managing managers, managing the people who are doing the work”. the Verge reported.
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Middle managers – defined as non-executives who oversee employees – accounted for almost a third of layoffs last year, up from 20 per cent in 2018, according to an analysis by Live Data Technologies for Bloomberg News.
But cutting middle managers can backfire, as they are often responsible for providing direction and support for entry-level hires. A recent book by three partners at McKinsey & Co argued that middle managers play an “often-overlooked” role in instilling collaboration and creativity at their firms, a task that’s more challenging than ever in today’s era of remote and asynchronous work.
Samantha LaBonne, a senior client success specialist at Indeed, said in a LinkedIn post that she just returned from parental leave “to be welcomed with a round of layoffs”.
While she wasn’t impacted, “it’s a sad day to come back to work”, she said.
Hyams said he would share more details about the cuts and Indeed’s organisational structure in a global town hall on Tuesday. The reductions will not have any “measurably disproportionate impact on women and under-represented genders or the under-represented minority population in the US”, he said. An undisclosed number of workers in the UK, Ireland and Australia will also be affected, Indeed said.
“It appears that my tenure at Indeed has come to an end with today’s round of layoffs,” said Andrew Stalick, a senior user-experience designer at Indeed. “I will spend a moment to take a breath, then I’m right back on the job hunt.” BLOOMBERG
