Rising trend of layoffs in tech industry raises concerns

Meituan Dianping Photo: VCG

A number of Chinese tech companies have reportedly begun to reduce workers on their payroll, raising concerns about a business slowdown in the booming industry.

Several netizens on Wednesday said on social media that Meituan Dianping, the country's largest online and on-demand delivery platform, is cutting staff in content operation, research and development, and other departments, most of whom are this year's college graduates.

The company, which went public in Hong Kong in September, denied the reports, saying that it is just part of "normal operational restructuring".

According to Meituan Dianping's financial report, about 250 employees among a total of 51,207 were laid off this time.

The company did not give any specifics on which departments were affected by the move.

Zhihu, China's Quora-like question-and-answer website, has cut about 100 staff as of December 14, according to influential financial magazine Caixin.

In a public response, the company told Caixin that the layoffs are routine personnel adjustments carried out at the end of each year.

"The move by Zhihu came abruptly, without any signs," said an employee who had been fired.

JD.com, China's second-largest shopping site following Alibaba, reportedly cut staff in November when its founder and CEO Liu Qiangdong, also known as Richard Liu in the English-speaking world, was involved in a rape scandal in the US.

The tech giant said that the reports are untrue, and that the layoffs were part of routine personnel adjustments.

NetEase, one of the largest Internet and video game companies in China, also shrank its AI team from nearly 400 to over 140, Caixin reported.

An industry insider told Caixin that more people have been hunting for jobs since October, adding that the situation next year will not be optimistic either.

According to data from China's leading recruitment website 51job, the number of recruitment listings on the platform fell by over 2 million from April to September, meaning that it is more difficult for people to find jobs.

The rising trend of layoffs add to fears that China's tech industry is starting to cool, threatening millions of jobs and a pillar of the country's economic growth.

Great leap

Over the past two decades, many respected tech companies have sprung up in China, the world's biggest market, including Alibaba, Tencent, and Baidu.

Their business success has significantly changed ordinary people's daily life, and been recognized by China's top leaders.

During the grand gathering to celebrate the 40th anniversary of the reform and opening up in Beijing on Tuesday morning, 100 people including Jack Ma, Pony Ma, and Robin Li were honored as pioneers of the development agenda.

However, the industry has encountered some challenges this year like revenue drop due to the slowdown of the Chinese economy.


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