On Monday, professional networking platform LinkedIn announced that it would be cutting approximately 668 jobs, amounting to 3% of its global workforce. The layoffs will impact roles across the company’s engineering, product, talent, and finance divisions.
This is the second round of job cuts at LinkedIn just this year. In May, the Microsoft-owned company laid off nearly 700 employees. The latest job cuts come during a time of economic uncertainty, with inflation on the rise and revenue growth slowing for many tech firms.
In a statement, LinkedIn said the cuts were necessary to “ensure that we are best positioned for long-term growth and success.” LinkedIn remains a profitable company, reporting $4.6 billion in revenue and $574 million in net income in Q1 2023. However, revenue growth has slowed to 23% this year compared to 34% at the same time last year.
The job cuts have elicited mixed reactions. Some have criticized LinkedIn for laying off employees while still being profitable. Others argue the cuts are essential to keep the company focused during a period of slower growth.
It remains unclear precisely how the reductions will impact LinkedIn’s business going forward. Analysts have expressed concerns that innovation and product development could stall as a result. However, supporters say the layoffs will allow LinkedIn to concentrate on its most profitable sectors like advertising and talent solutions.
Other major technology companies, including Meta, Twitter, Netflix, Shopify, Robinhood, and Coinbase have also announced significant job cuts in 2022 amid rising inflation and fears of an economic slowdown. The tech industry appears to be entering a period of belt-tightening after a bull market in recent years.
For affected LinkedIn employees, the company has promised severance pay and career transition assistance. But the job cuts are still likely to deal an economic and emotional blow, coming amid broader economic uncertainty.
As a top professional networking platform, LinkedIn’s health has major implications for professionals and businesses worldwide. This latest round of layoffs suggests LinkedIn is under pressure to retool its operations to weather challenging economic times ahead. How well the company manages that transition will determine its success in the coming months and years.
