Another tech company says it will cut hundreds of jobs amid pivot to AI
Layoffs continued, with another tech company saying it was reducing headcount so it could use more artificial intelligence.
Groupon announced in a security filing this month that it would lay off up to 400 people, or nearly 25% of its global workforce, as part of a broader restructuring plan to make the platform more AI-based. The Chicago company plans to make layoffs in the coming months.
Previously, the company’s Chief Executive Dušan Šenkypl said that the company “fell short of our expectations” last quarter.
According to the report, more than 800,000 technology workers have been laid off since 2022. layoffs.fyiA website that tracks layoffs.
The rise in pink slips began in 2023, as companies on hiring sprees began cutting back during the COVID-19 pandemic. From January through April this year, tech employers in the U.S. announced 85,411 layoffs, up 33% from the same period last year, according to global employment and executive coaching firm Challenger, Gray & Christmas.
Groupon said in its filing that its decision to transition to an AI-based company was to “better fulfill our mission by serving both customers and merchants.”
The company said the layoffs would cost it $13 million but save more than $20 million a year.
This announcement comes as many e-commerce companies are shifting their business models to AI to reduce costs by automating many roles.
Artificial intelligence has also triggered fierce competition for top talent and sparked tens of thousands of layoffs this year. As a result, class divides are widening in Silicon Valley as a small group of workers receive unprecedented packages for their AI skills while many other workers struggle to find work.
The poor do all the things that used to guarantee great jobs; like revamping resumes, optimizing LinkedIn profiles, and conducting interviews. But companies are being much more selective these days. Tech unemployed are rethinking their lives. Some are taking pay cuts, while others are leaving technology. Some are returning to work or starting new ventures. Some have retired.
Groupon shares, which have fallen 27% in the past 12 months, fell 1% to $21.20 on Thursday.
