Zoom Cuts 1,300 Jobs as Pandemic Era Demand Wanes

Zoom stepped up its recruitment tactics during the pandemic to meet growing demand, but like many other U.S. companies, they have to restrict costs in anticipation of a potential recession.

What’s going on:

Zoom has announced that it would be cutting approximately 1,300 jobs due to decreasing demand for their video conferencing services, and incur a charge of up to $68 million as a result.

Zoom CEO Eric Yuan added that he would reduce his own pay by 98% in the upcoming fiscal year, as well as renounce his bonus.

Why it matters:

Zoom stepped up its recruitment tactics during the pandemic to meet growing demand, but now, like many other U.S. companies, they have to restrict costs in anticipation of a potential recession.

How it’ll impact the future:

To demonstrate their commitment to this plan, Zoom’s executive leadership team will reduce their base salaries by 20%.

This move deviates from other recent tech layoffs, which have suspiciously turned to massive layoffs before considering a deduction in executive pay. While a rare move, Zoom’s approach may normalize making job cuts a complete last resort.