Uber Technologies will cut about 3,300 jobs, representing roughly 10% of its global workforce, as part of a major restructuring aimed at reducing management layers and reallocating resources towards its core ride-hailing, delivery and robotaxi businesses.The job cuts will reduce the number of managers at the company by 20%, chief executive officer Dara Khosrowshahi said in an email to employees.An Uber spokesperson said some managers would be moved into individual contributor roles, while the layoffs would also affect employees who are not managers.Uber had about 34,000 employees globally at the end of last year, according to its annual report cited by Reuters.
Uber seeks to cut layers and simplify teams
Khosrowshahi said Uber’s rapid growth over the past five years had created greater complexity within the company.“Over the last 5+ years, Uber has grown by orders of magnitude, with our top line nearly tripling,” he wrote in the email, which was obtained by Bloomberg News.“But that growth has also brought complexity: more layers, more coordination, more fragmented ownership, and in some cases structures that made sense when businesses were smaller but no longer serve us well at our current scale.”The restructuring is aimed at making the company “simpler and faster”, Khosrowshahi said. Uber has reduced roles primarily focused on coordination and broadened managers’ responsibilities, particularly in teams with only one or two direct reports.According to Khosrowshahi’s email, the number of employees sitting seven or more layers below the CEO has been reduced by 20%, while the number of such small teams, or “micro-teams”, has been cut by nearly 50%.The company is also combining teams where it believes fragmentation has created duplication and slowed decision-making. Uber will merge its three Delivery Operations teams covering restaurants, retail and Direct into single teams at the global, regional and country levels.Its Core Services Engineering and Science teams are also being combined, Bloomberg reported.
Only around 1% of staff to remain remote
Uber is also tightening its location and remote-work policies as part of the overhaul.The company will concentrate global teams in its largest global hubs in New York and San Francisco, while regional, local and technology teams will be based in designated hubs.The company is asking the vast majority of remote employees to move to an office. Going forward, only around 1% of Uber’s employees will be allowed to work remotely, while the company will continue to enforce its hybrid policy requiring staff to work from the office three days a week.Khosrowshahi said the savings from the restructuring would be reinvested in growth, innovation and other capabilities.“Our opportunity from here is enormous: we have the chance to bring Uber to hundreds of millions more people; to invest even more in drivers, couriers and merchants; and to innovate across our core businesses and build the autonomous future,” he said.
Focus shifts towards robotaxis and AI
The restructuring comes as Uber has pledged to commit more than $10 billion to robotaxi partnerships in the coming years.The company has also invested in Avride Inc., Lucid Group Inc., Nuro Inc. and Rivian Automotive Inc., while reallocating capital by reducing stakes in some other companies.The latest layoffs follow more targeted job cuts Uber made this year in its customer service and human resources departments. Unlike several major technology companies, Uber had avoided large-scale workforce reductions since the Covid-19 pandemic.Uber said in May that it would moderate the pace of hiring. Wednesday’s cuts will bring the company’s total employee count to just under 30,000.Khosrowshahi did not mention artificial intelligence as a reason for the restructuring in his announcement, though Bloomberg reported that the changes were also being driven by Uber’s efforts to use more AI technology in its daily operations.Uber’s shares rose 2% following the announcement.