Just two months into the pandemic, Airbnb laid off a quarter of its workforce—1,900 people. The company, which ended the year with an IPO, had lost about 80% of its business due to the pandemic, says CEO Brian Chesky. Luck in an interview on Wednesday.
“We didn’t know when [the business] was coming back,” he says.
Layoffs have never been awful. Maybe they strike differently because it shatters the corporate illusion that work is like a family. because when it comes time to cut costs, work is about more than dollar signs and decimals.
Even Chesky, who with co-founders Nathan Blecharczyk and Joe Gebbia, built Airbnb around a sense of belonging and a sense of purposeful ethics often at odds with other Silicon Valley darlings, acknowledged the disconnect.
“How can a company whose mission is centered on belonging tell thousands of people they can no longer be with the company?” he said during a podcast appearance in May 2020 Out of Crisis. “It was a very, very difficult thing to deal with.”
The recent deluge of layoffs in the tech world has documented just how innately good—in some cases, harsh—layoffs can be. In November alone, tech companies announced 31,200 job cuts, according to Challenger, Gray & Christmas, a firm that advises employers on layoffs.
Snap, Coinbase, Robinhood, and Tesla, among others, have announced layoffs in recent months. Amazon also plans to lay off thousands of workers. None, however, have garnered the attention that Meta has more recently, and even more so Twitter. Both have been criticized for either the seemingly insensitive nature of layoffs (the case of Twitter) or the careless effect on layoffs (the case of Meta).
Both might have been better off taking a page out of Airbnb’s layoff book.
Musk had no compassion
Airbnb was praised for its handling of layoffs in 2020. A note Chesky wrote expressing love for his employees was seen as compassionate, empathetic and a lesson in leadership and communication.
“We did it with a kind of novel because I did a couple of things: The first thing I did was I wrote this letter that was very transparent. We went step by step about what happened, how we got here,” Chesky says, democratically noting the recent Technology layoffs run the gamut from good to bad.
Experts say it’s best to cut deep and cut once, to show empathy, offer support and be open and transparent about the company’s direction. A generous layoff doesn’t hurt either.
In addition to offering a substantial severance package and health care benefits, Chesky seemed most proud of the alumni roster that gave laid-off employees a chance to hear from recruiters at other companies looking to hire through Airbnb and new job offers.
At the other end of the spectrum, Musk is battling the remaining half of employees he didn’t fire with little more than an unsigned email that landed in his inbox after the workday (others found out they were out of a job when they couldn’t log into their email or system their company messages), drawing a relatively hard line to increase productivity and return to the office.
A senior Twitter engineer has apparently been fired via tweet by Elon Musk after the two argued briefly on the app about Twitter on Android.
“With layoffs you just have to make sure you go above and beyond what’s expected, you’re incredibly compassionate, and you allow people to leave the company with dignity,” says Chesky.
Zuckerberg was ‘overly optimistic’
On another spectrum, Chesky also says that “companies have probably been overly optimistic over the last couple of years,” a mistake that Meta CEO Mark Zuckerberg faced when he announced about 11,000 layoffs earlier this month.
“They hired because they thought what happened in the last two years was going to happen forever,” Chesky says. “There’s been a huge shift from retail and physical to digital. But I think as people spent more and more screen time, they said, ‘this can’t be my whole life, I want to get out of the house.’
Airbnb has remained relatively lean for its size, Chesky says. The company employs about 6,000 people and planned to increase staff by only 7% this year before the economy took a turn.
“Sometimes the fastest way to grow is to have very small teams that can move very quickly and nimbly,” says Chesky. “We don’t need to make a lot of other changes, the work is going really well. If anything, we’re not hitting the brakes, we’re really rather hitting the gas.”
This story was originally featured on Fortune.com
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