(MENAFN) The Walt Disney Company is set to begin the first of three phases of cutting 7,000 jobs, or 3.2% of its workforce. CEO Robert Iger stated that the company will begin notifying employees whose positions are impacted by the workforce reductions this week. The first group of impacted employees will be informed directly over the next four days, with a second, larger round of notifications scheduled for April. The final round of notifications is expected to take place before the beginning of the summer to reach the target of 7,000 job cuts.
Last month, the US-based multinational entertainment conglomerate announced its aim to save around $5.5 billion in costs, citing economic uncertainty as the reason for the workforce reductions. Disney's global workforce stood at approximately 220,000 as of October 1, 2021.
Disney's decision to cut jobs is not unique, as more than a dozen companies in the US, particularly in the tech sector, have been reducing their workforces due to lower income, falling ad revenue, and fears of a recession. Companies such as Amazon, Yahoo, Affirm, Zoom, Dell, IBM, Microsoft, Salesforce, PayPal, and Google's parent, Alphabet, have been laying off workers by the thousands in recent months.
The job cuts at Disney highlight the economic challenges faced by companies in the entertainment industry due to the ongoing COVID-19 pandemic. With many theme parks and theaters closed or operating at reduced capacity, the company's revenue has taken a hit, leading to the need for cost-cutting measures.
The workforce reductions at Disney also have a ripple effect, affecting the livelihoods of thousands of employees and their families. As the COVID-19 pandemic continues to impact the economy, it is likely that more companies will be forced to make difficult decisions to reduce their workforces to stay afloat.
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