Uber layoffs: Company cuts 3,300 jobs; CEO Dara Khosrowshahi says, "I realize this is a lot of change, but it was better to…

Uber is cutting about 3,300 jobs, close to 10 percent of its global workforce, in the sharpest restructuring the ride-hailing company has attempted since the pandemic. The layoffs were announced on Wednesday in a companywide email from chief executive Dara Khosrowshahi, who framed the decision as a fix for an organisation that had grown too many layers between the people making calls and the people building products. Everyone affected has already been told, except in countries where local labour rules require a longer process.The scale is easier to grasp with the older numbers next to it. Uber had roughly 34,000 employees at the end of last year. After this round, headcount drops to just under 30,000, which is about where the company stood in 2021. The last time Uber cut deeper was May 2020, when it let go of about 6,700 people as lockdowns wiped out ride demand. This time the business is doing well, and Khosrowshahi said as much in the email, which is exactly why the announcement landed the way it did.Uber's job cuts target managers and micro-teams, not just headcountThe restructuring is aimed at the shape of the org chart rather than any single division. The number of managers falls by 20 percent, with some moved into individual contributor roles instead of being let go. Uber also reduced the count of employees sitting seven or more reporting layers below the CEO by 20 percent, and cut "micro-teams" of only one or two reports by nearly half. Non-managers are affected too.Teams are being merged where the company felt the split had stopped making sense. The three delivery operations groups covering restaurants, retail and Uber's white-label direct service are being folded into single-owner teams at global, regional and country level. In tech, Core Services Engineering and Science are being combined, mirroring how Mobility and Delivery are already run.Uber's restructuring brings remote roles down to about 1 percent of staffThe other significant change is where people sit. Global teams will be concentrated in New York and San Francisco, regional teams in designated regional hubs, and tech teams in tech hubs. Most remote employees are being asked to move to an office. Going forward only about 1 percent of staff will be fully remote. The existing three-day-a-week hybrid policy stays in place, and Khosrowshahi said compliance with it will be reinforced.Robotaxi spending explains the timing behind Uber's layoffsKhosrowshahi said the savings will be reinvested in growth and in what he called the autonomous future. That is not an abstract line. Uber has committed more than $10 billion to robotaxi partnerships over the coming years and has been reshuffling capital to fund it, trimming stakes in some companies while investing in Avride, Lucid, Nuro and Rivian.The pressure is visible in the stock. Uber shares have fallen nearly 8 percent this year and lagged the S&P 500, with investors worried that Waymo and others could chip away at Uber's North American lead. The stock rose about 2 percent in premarket trade after Wednesday's announcement.One detail sets this apart from most tech layoffs of the past two years. Khosrowshahi did not blame artificial intelligence anywhere in the email, even though the company has been steadily pushing AI into daily operations. The cuts follow smaller reductions in customer service and human resources earlier this year, and a May decision to slow hiring.Uber CEO Dara Khosrowshahi's email to employees, in full:Team,Today, we're making a number of significant organizational changes across Uber. We are removing layers, simplifying team structures, refining our global location strategy, and focusing our people and investments against the biggest opportunities ahead of us. As a result, we will be reducing the size of our team by about 10%. Everyone whose role has been affected has already been notified, except in countries where we will follow the required local process.This wasn't a decision we made lightly, because it will have a real impact on our teammates and friends who have worked hard for Uber. It's important to say that these changes are about how we're organized and what we're prioritizing, not about anyone's contributions to Uber, which we will always value.I'm sure you're asking, 'Why, and why now?'—particularly since our business is performing so well. Over the last 5+ years, Uber has grown by orders of magnitude, with our top line nearly tripling. We've built new products, expanded into new businesses, reached more consumers and supported more earners, and become a much larger and stronger company. But that growth has also brought complexity: more layers, more coordination, more fragmented ownership, and in some cases structures that made sense when businesses were smaller but no longer serve us well at our current scale.Our opportunity from here is enormous: we have the chance to bring Uber to hundreds of millions more people; to invest even more in drivers, couriers and merchants; and to innovate across our core businesses and build the autonomous future.To do those things, we need to make deliberate choices about where we put our people, our time, and our capital.The changes we're making today are designed to do two things: make Uber simpler and faster, and create more capacity to invest in our future. A leaner organization will mean clearer ownership, faster decisions, and more time spent building rather than coordinating. It will also generate savings that we intend to reinvest in growth, innovation, and the capabilities that will matter most over the coming years.It's our job as leaders to make these difficult calls, and to give you transparency into our thinking and our decision-making process. Here's what we are doing and why:Organizational health: In Pulse surveys and conversations with many of you, we've heard that too much work requires coordination across teams, debates take too long, and decision-making rights are unclear. I'm sure many of you have felt that you spend too much time "aligning" rather than building, shipping, or serving customers. To improve this, we have reduced roles primarily focused on coordination, and have clarified the remit of the coordination roles that remain. We also cut down the number of management layers by broadening manager scopes, particularly where we had "micro-teams" of only 1-2 reports. In all, we've reduced the number of employees who sit 7+ layers from the CEO by 20% and the number of micro-teams by nearly 50%. The outcome is a simpler org chart geared toward building versus managing.Team simplification: We brought together teams where fragmentation was creating duplication and slowing decisions. The most significant example of this is Mac's decision to combine our three current Delivery Ops teams (across Restaurants, Retail, and Direct) into single-threaded teams at the global, regional, and country levels. Running these three businesses separately made sense in their early days, but that structure is no longer serving us at scale. Bringing the P&Ls together under single owners will reduce overlap, clarify accountability, and allow GMs to allocate capital more efficiently and effectively based on their strategic imperatives. Another example of this: in Tech, we're combining our Core Services Engineering and Science teams, mirroring the structure we already have on Mobility and Delivery.Location strategy: The benefits of sitting together, collaborating in person, and solving problems as a team are clearer than ever in our post-Covid world. With that in mind, we're establishing clearer principles for where roles and teams should be based, with the goal of concentrating teams in a smaller number of key hubs. Global teams will be concentrated in our largest global hubs, NY and SF; regional teams in designated regional hubs; local teams in country hubs; and tech teams in tech hubs. We'll prioritize co-location between managers and their teams wherever possible, particularly for earlier-career employees. We are also asking the vast majority of remote employees to move to an office, and going forward, only ~1% of employees will be remote. We'll also continue to reinforce compliance with our hybrid work policy, which requires three days a week in the office.I realize this is a lot of change, but we decided it was better to make one big shift rather than multiple small ones. We also know organizational changes can be hugely distracting, and our job is to create an environment that allows you to focus and do your best work. With these decisions now made, our focus is on the future.We have tremendous momentum, significant financial capacity, and opportunities in front of us that are larger than at any point since I joined the company. The decisions we're making today are difficult, but they will help us build an even stronger Uber for the years ahead.You can read more about the changes across the company here, and please be sure to read specific follow-up information you'll receive from your leaders about what this means for your team, so we can all keep building together.Uber on,DaraGet the latest technology news and updates. Download the TOI App.