The company has approved plans for strategic staff reductions in 2020. However, the new layoffs came after PayPal showed signs of slowing growth. In the first quarter of the year, transfers within the platform increased by 15% to $323 billion. This was the smallest increase in the last 5 years. This could be due to shortages of some goods due to the global supply chain crisis, as well as the fact that people have returned to shopping in stores after the quarantine restrictions have been eased.
PayPal has spent $100 million on severance pay and other job cuts and expects to spend even more. However, in the long run, the restructuring will save the company $260 million a year.
PayPal is just one of many technology companies that are downsizing or freezing their employees due to the economic downturn. Microsoft, Meta, and NVIDIA intend to limit the hiring of employees due to falling stock prices and slowing sales and revenue growth. Uber and Lyft are also cutting staff as part of their cost-cutting measures.