Coworking giant, WeWork recently laid off 300 employees which amount to a total of 3 percent of its overall workforce. These employees were working across WeWork, WeLive, and WeGrow divisions of the firm. A couple of months earlier WeWork had rebranded into the WeCompany in order to expand the list of services it offers. Headquartered in New York, the company provides services to 10,000 employees. It has established its centers across various locations in some of the largest cities. Not to mention, it is a widely acknowledged coworking space and is backed by a large amount of investor money. But the question that arises, in this case, is that has it been able to deliver its best? Or is it experiencing a downfall? The removal of employees from the organization surely support these speculations.
The reason behind this decision
WeWork made it official that the reason behind the dismissal of 300 employees was related to their performance. Further, it announced that the company will be hiring 6,000 employees this year. Earlier, Softback, a major investor of WeWork had cut down the investment price from $16 billion to $2 billion. It was a big disadvantage for the company as it could hamper the growth of its development plans. Also, this is not for the first time that WeWork has taken this step. Previously, in the year 2016, it had laid off 7% of its total workforce. At that time as well, the reason was linked to the performance of the employees.
- WeWork came forward with its decision to lay off a total of 300 employees from its entire workforce.
- According to the company, this decision was based on the performance of employees.
- WeWork plans to add 6,000 employees this year to further its growth in the market.
Suggested reading: WeWork Acquires Tech Firm ‘Euclid’ to Diversify its Services
The current scenario of WeWork
Currently, WeWork is valued at $45 billion. The company has been undergoing a lot of losses until it met an important ally, Softbank. In 2017, it suffered a loss of $933 million dollars as per the records. However, this year, the company claims that it will come up with great expansion plans and grow on a global level. One of the projects it is currently working on includes its expansion to South Korea. This is because of the increase in the number of startups in the area and the growing demand for collaborative workspaces. It faces stiff competition by coworking spaces like Servcorp, Regus, WOTSO and more. Obviously, the palpable tension in the atmosphere raises some serious concerns. However, it all depends upon how the company makes it through the year with a minimum loss.