Flexport is to cut 20% of its jobs, with affected employees in Europe and North America receiving emails in the next few hours, and those in Asia tomorrow.
The letter to employees from co-CEOs Dave Clark and Ryan Petersen opens: “We begin the new year with more optimism than ever about Flexport̵[ads1]7;s future.”
But it continues: “We must also make the difficult decisions necessary to set ourselves up for long-term success.
“We are in a good position overall, but are not immune to the macroeconomic downturn that has affected businesses around the world. Our customers have been impacted by these challenging conditions, resulting in a reduction in our volume forecasts through 2023.
“Lower volume, combined with improved efficiency as a result of new organizational and operational structures, means we are overstaffed in a number of roles across the company.”
The letter adds that the company will reduce its global workforce by around 20%, around 600 people.
There are jobs in all departments, across all geographies, but the company will continue to operate in all its regions, with no offices being closed.
US employees who leave the company will receive “12 weeks of severance pay, six months of extended health care, a 2022 bonus, acceleration of stock vesting, including releasing vesting for those with six months or more of employment, immigration support and the opportunity to join our alumni talent directory to help with future job opportunities”.
There are no details for other regions.
But the company is also adding jobs — about 350 to 400 engineers and software workers — as it focuses on efficiency and technology. It said: “2023 will bring extraordinary speed – we are doubling our software engineering talent and moving to single-threaded business organizations to build world-class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers.”
Flexport said the slowdown would give it time to build up its technology so that when the economy recovers “we need to be nimble, fiscally responsible and focused on building quickly with operational excellence”.
(The entire letter to employees can be read here.)