No retrenchments at Uber SA

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 12 Sept 2019

Uber SA has confirmed that local operations will not be affected by its spate of retrenchments in the US.

This week, the ride-hailing company announced it is cutting 435 jobs, which is 8% of its staff, in the engineering and product divisions in the US.

The retrenchments, which the company said will not affect its UberEats business, come after Uber sacked 400 employees in July across the company’s 1 900 marketing personnel in its 75 global offices.

Samantha Fuller, Uber SA communications manager, has allayed fears regarding the company’s local operations, explaining in an e-mail sent to ITWeb: “These retrenchments don’t affect SA and are predominately happening in the US.”

She did not respond to questions relating to the possibilities of the company instituting a hiring freeze in future.

The ride-hailing firm’s retrenchment mode comes as it has been losing money faster than it makes it, after its initial public offering earlier this year did not live up to expectations.

According to Reuters, the company debuted on the New York Stock Exchange in May, at an IPO price of $45.

The stock has since been taking a beating and is currently trading at nearly 2% below the IPO price.

“Today, we’re making some changes to get us back on track, which includes reducing the size of some teams to ensure we are staffed appropriately against our top priorities,” according to a global statement released by Uber this week.

“These were incredibly difficult calls as it means some of our employees no longer have a role, specifically around 170 people in our product group and 265 people in engineering, which is roughly 8% of those two organisations.”

In order to meet the demands of a hyper-growth start-up, the company says it previously hired rapidly and in a decentralised way. While this worked for Uber in the past, it notes, now that it has over 27 000 full-time employees across the globe, it is shifting how the organisation is designed by creating “lean, exceptionally high-performing teams, with clear mandates” and the ability to execute faster than its competitors.

“While certainly painful in the moment, especially for those directly affected, we believe this will result in a much stronger technical organisation, which going forward will continue to hire some of the very best talent around the world,” according to the statement.