News: Airbnb CEO advises companies to 'cut jobs deep enough' when laying off, but why

Strategic HR

Airbnb CEO advises companies to 'cut jobs deep enough' when laying off, but why

Chesky strongly emphasised the importance of making a single, comprehensive cut during layoffs, stating, "When implementing layoffs, it is crucial to cut once and cut deep enough.”
Airbnb CEO advises companies to 'cut jobs deep enough' when laying off, but why

In the first three months of 2023, U.S.-based employers alone witnessed a layoff bloodbath, with a staggering 417,500 jobs being cut. Adding to the intensity, companies such as Meta and Amazon have already undergone their third round of layoffs this year, creating a relentless cycle of headcount reductions.

Hence, Brian Chesky, the CEO and co-founder of Airbnb, suggested that struggling companies should spare surviving employees from the mental toll of multiple rounds of layoffs by opting for one drastic sweep.

“Multiple layoffs can be very difficult from a cultural standpoint, because if there's more than one, then people can't trust they’ll ever end—and the company is like, in a paralyzed standstill if that happens,” he said in a video interview with Bloomberg. 

“When you do a layoff, if you're going to cut you need to cut once, and therefore you better cut deep enough. Try to avoid doing multiple layoffs,” Chesky insisted. 

Chesky also expressed dissatisfaction with the standardised and impersonal manner in which layoffs are typically announced, finding fault with the robotic, carbon-copy approach adopted by many companies.

Chesky explained his perception of corporate communications, stating, " I always felt like when I read some of these corporate communications that...they weren't written by people." He further commented that the usage of corporate jargon is likely a result of committee-driven writing processes.

Chesky noted, "Many CEOs don't write anything that they put their name on. However, any communication that I write..." He doesn't make these remarks without personal experience. 

Just a couple of months into the pandemic, Airbnb had to lay off 25% of its workforce after facing an approximate 80% decline in business. However, Airbnb received praise for its handling of the layoffs. Chesky's memo, in which he openly explained the reasoning behind the job cuts and expressed his deep care for the staff, was widely recognised as a compassionate and empathetic piece. 

It served as a valuable example of leadership and effective communication, according to a report by Fortune. 

Apart from providing generous severance packages and healthcare benefits, Chesky disclosed to Fortune that he took pride in the alumni directory feature. This feature facilitated communication between laid-off employees and recruiters from other companies who were using Airbnb's platform to hire, enabling the affected individuals to explore new job opportunities and receive offers.

“With layoffs you should just make sure you do more than what’s expected; you’re incredibly compassionate; and that you allow people to leave the company with dignity,” he concluded.

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Topics: Strategic HR, #Layoffs, #HRTech, #HRCommunity

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