Spotify layoffs coming, 17% of workers to be made redundant

A recently announced decision will see huge cuts at Spotify, with 17% of the workforce being made redundant – about 1,500 people, reports the BBC.

“I recognize this will impact a number of individuals who have made valuable contributions”, added Daniel Ek, the chief executive of the Swedish streaming service provider. Although the announcement does not specify which jobs will be affected, it is questionable how the company will cope with the weight of the cuts. In fact, they have had layoffs before, barely a year ago in January, when they laid off 6% of their workforce. However, that didn’t seem like a big number at the time with only about 600 people, while big tech companies like Spotify (Amazon, Microsoft, Twitter, Alphabet, etc) were laying off thousands of people.

According to Daniel Ek, this decision was taken because economic growth has slowed dramatically. Spotify currently employs more than 9,000 people. And while their jobs and careers sub-sites are always full of positions, the picture above shows that there are now empty positions since the firings in early December. At the time of the cuts in January, Daniel Ek referred to his decision as an organizational restructuring and said he took responsibility for the decisions that brought the company to this point. At that time, Dawn Ostroff, who was responsible for content, licensing, and advertising, also left.

In their latest financial report, they reported a profit of €65m in the three months to September. One of the reasons for this is that, despite the price increases announced in July, their subscriber numbers have continued to grow. In recent years, they have also invested heavily in podcasts and audiobooks, also in order to drive more users and subscribers to the platform. And last but not least, many changes in the distribution of royalties have been announced by Spotify, leading to various agreements with several major labels in recent months.

Image Credit: thibaultpenin (Unsplash)