WeWork Cuts Another 250 Jobs in Further Attempt to Trim Costs
(Bloomberg) -- WeWork continued to cut more staff as part of a months-long effort to lower expenses after its failed initial public offering last year, the company said.
The New York-based co-working company axed about 250 jobs in its development department on Thursday, according to two people familiar with the matter, who asked not to be identified discussing personnel details.
The reductions aren’t related to the impact of the coronavirus, one of the people said. Last fall, as WeWork looked to dramatically cut its expenses after the fumbled IPO, it stopped leasing as many locations, which lowered its need for construction and remodeling.
“WeWork is continuing to execute its new strategic plan,” a spokeswoman wrote in a statement. “As a result, we are realigning certain functions and teams to reflect our business priorities.” Employees affected by the cuts received the same severance package offered to the 2,400 WeWork staff who had their jobs eliminated in November: four months of salary and benefits, or six months for employees who had been with the company for more than four years. WeWork also quietly cut dozens more jobs in February.
WeWork still faces a rough road ahead as the global pandemic is likely to make its members, more than a quarter of which were on month-to-month leases last year, hesitant to renew contracts or likely to default if they have lost income. The company also is facing a public battle with its majority owner SoftBank Group Corp. as the investor threatened last week to unravel part of a $3 billion deal to buy back shares from investors and employees.
©2020 Bloomberg L.P.