Microsoft-owned LinkedIn has announced a second round of layoffs this year, impacting 668 employees across its engineering, talent, and finance teams. This move is a result of slowing revenue growth for the professional social media network.
The layoff, affecting over 3% of LinkedIn's 20,000-strong workforce, adds to the significant job losses experienced in the technology sector in 2023 due to the uncertain economic outlook.
LinkedIn shared in a blog post that these organizational changes are aimed at streamlining decision-making processes while continuing to invest in strategic priorities for the future, emphasizing their commitment to delivering value to members and customers.
The technology sector has witnessed a substantial workforce reduction in the first half of the year, totaling 141,516 employees, a sharp increase from about 6,000 job cuts recorded a year ago, as reported by employment firm Challenger, Gray & Christmas.
LinkedIn generates revenue through advertising sales and subscription charges for recruitment and sales professionals who utilize the platform to identify potential job candidates. In the fourth quarter of its fiscal year 2023, LinkedIn's revenue showed a 5% year-on-year increase, compared to the previous quarter's 10% growth.
Microsoft, the parent company of LinkedIn, has identified challenges such as a slowdown in hiring and a decline in advertising spending as contributing factors to LinkedIn's performance issues, even though it continues to expand its community, which now boasts 950 million members.
Earlier this year in May, LinkedIn had initiated a workforce reduction, cutting 716 jobs within sales, operations, and support teams, with the aim of streamlining operations and expediting decision-making processes.
These layoffs raise questions about the evolving landscape of the technology industry and the economic uncertainties impacting tech companies, even as they strive to adapt and refocus for future success.