Tech startups globally have laid off 69,000 employees amid COVID-19 pandemic

Over 500 tech startups have laid off more than 69,000 employees between March and July due to the COVID-19 pandemic, according to data gathered by BuyShares, a UK-based investment firm.

Nearly half of the global workforce is at risk of losing their jobs, the investment firm said. Thousands of companies worldwide have been forced to reduce costs and cut the number of workplaces, and startups are no exception, the firm noted. Suffering the biggest losses are startups in transportation, finance, and travel, which have cut 31,000 jobs in four months, BuyShares said. Retail is close behind, with 7,600 job cuts.

In March, the number of employees who had been laid off amounted to 9,628, BuyShares said, citing data from Statista and Layoffs.fyi, which compiles public layoffs announced in the tech industry.

In the next 30 days, this number jumped by nearly four times, reaching 36,244 by the end of April. Statistics show the number of job losses continued rising, reaching almost 62,000 in May, the firm said. Since then, another 7,645 jobs have been lost, with the combined total reaching 69,623 the last week of June.

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With more than 14,600 job losses in this period, the tech startups in the transportation industry have taken the hardest hit. The finance industry ranked as the second-most impacted sector, with 8,466 startup employees losing their positions.

Startup companies in the travel sector had to lay off 8,198 workers due to the coronavirus outbreak, ranking as the third-most affected industry. Statistics show startups from retail, food, and consumer industry had to cut down more than 19,100 workplaces in the last four months. The real estate, fitness, and marketing industry follow with 3,503, 3,022, and 2,631 displaced workers, respectively.

Uber, Groupon, and Airbnb had the biggest layoffs

Analyzed by geography, startups from the San Francisco Bay area have been the most affected by the COVID-19 outbreak, with more than 25,500 displaced workers between March and July.

The Layoff Tracker data also revealed that Uber Technologies laid off the most employees since the COVID-19 outbreak. The San Francisco-based ride-hailing company cut a total of 6,700 jobs between May 6 and May 18, BuyShares said.

Groupon ranked as the second firm on the list, with 2,800 laid-off employees or 40% of its staff, the firm said. Airbnb is listed as the third-largest layoff amid the coronavirus outbreak. The San Francisco based company cut 1,900 jobs on May 5, or 25% of its staff.

The performance of tech startups, considered the lifeblood of the industry, surged during the first half of the last decade along with the Nasdaq 100 Index, a technology-heavy mix of large non-financial companies, Bloomberg reported. Then, in 2018, startups pulled significantly ahead of their publicly traded counterparts, driven in part by big gains in valuations at late-stage private companies, according to Bloomberg. That momentum has stalled this year.

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Article source: https://www.techrepublic.com/article/tech-startups-globally-have-laid-off-69000-employees-amid-covid-19-pandemic/#ftag=RSS56d97e7