online sales platform Shopify lays off 10% of its employeesAround 1,000 people, because the mass adoption of e-commerce during the pandemic did not lead to the expected change in consumption habits.
“About 10% of employees will have left the company today,” Canadian firm president Toby Lubke said Tuesday in a letter to its teams, also published on the company’s website.
The Shopify co-founder explains what the company hired based on trend predictions related to the pandemic in recent years.
“We bet … that the ratio of dollars spent in e-commerce versus physical stores will skyrocket permanently 5-10 years ahead of our estimate,” he said.
“It is now clear that this bet did not work out,” he admitted, saying “deeply disappointed” by the decision.
According to data from the Ottawa-based group, the proportion of online sales “continues to rise” regularly, but growth has returned to levels forecast before the health crisis.
The platform, which has online stores for small and medium-sized companies, lost more than 15% on Wall Street at 18:00 GMT.
Several tech companies, after benefiting for two years from a lockdown-related explosion in web shopping, decided to lay off employees or reduce hiring after consumers went back.