Last Updated on October 17, 2023 by Robert C. Hoopes
LinkedIn, the social media network for professionals owned by Microsoft, has announced plans to lay off 668 employees in its engineering, talent, and finance teams. This marks the second round of job cuts for the company this year as it struggles with slowing revenue growth.
The job cuts make up over 3% of LinkedIn’s workforce, which currently stands at 20,000 employees. These layoffs add to the significant job losses that have been seen in the technology sector this year, primarily due to economic uncertainty. In fact, the tech sector has already laid off a staggering 141,516 employees in the first half of 2020, a significant increase compared to the 6,000 layoffs in the same period last year.
LinkedIn stated that these job cuts are aimed at streamlining its decision-making processes and ensuring it can continue to invest in strategic priorities. Despite facing challenges, LinkedIn continues to attract new members, with a current community of 950 million.
A major factor contributing to the revenue slowdown at LinkedIn is the decline in advertising spending and a slowdown in hiring. In the fourth quarter of its fiscal year, LinkedIn’s revenue only increased by 5% year-on-year, compared to 10% in the previous quarter. Microsoft attributes these challenges to the current economic climate.
LinkedIn generates its revenue through advertising sales and subscriptions for recruiting and sales professionals. It remains to be seen how these job cuts will impact the company’s financial performance moving forward, but LinkedIn is hopeful that its strategic investment decisions will help drive future growth.
Earlier this year, in May, LinkedIn had announced 716 job cuts across its sales, operations, and support teams as part of its efforts to streamline operations and decision-making processes. These recent layoffs reflect the company’s ongoing efforts to adapt to the changing dynamics of the business landscape and ensure long-term sustainability.