Salesforce to dismiss over 7,000 workers as economic downturn bites harder

By Chisom Nwatu

American enterprise cloud-based software company, Salesforce, has announced plans to lay off 10 per cent of its workforce, a decision which will lead to over 7,000 workers in the company losing their jobs.

Salesforece made the disclosure in a letter addressed  to its employees on Wednesday, citing a challenging environment caused by the economic downturn. The company  also blamed the decision on the fact that it hired too many people during the COVID-19 pandemic.

As of early 2022, the company’s employees figure stood at 73,541 people globally, a 30 per cent increase compared to 2021.

Marc Benioff, the company’s chair and co-chief executive officer, in the letter to the company’s employees dated January 4, 2023, said that the company hired too many people which led to the economic downturn.

“The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions. With this in mind, we’ve made the very difficult decision to reduce our workforce by about 10%, mostly over the coming weeks.

“I’ve been thinking a lot about how we came to this moment. As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”

“Within the next hour, employees who are initially affected by this decision will receive an email letting them know. Our leadership will reach out directly to these employees, and provide clarity for their teams about changes within their organizations,” the letter read.

Benioff also said the company would provide full support for those that will be affected by the layoff.

According to him, affected employees in the U.S  will receive a minimum of nearly five months of pay, health insurance, career resources, and other benefits to help with their transition. He added that those outside the U.S. will receive a similar level of support, and the local processes will align with employment laws in each country.

The announcement from Salesforce just a few days into 2023 marked the resumption of the mass layoffs by tech giants, which started in the fourth quarter of 2022, and which analysts had predicted would continue into the first quarter of 2023. It followed the 11,000 mass layoffs by Meta and the 3,700 head cuts by Twitter among several others.