News / Weak 2023 forecast pushes Flexport to slash 20% of global workforce

Flexport is to cut 20% of its jobs, with impacted staff in Europe and North America receiving emails in the next few hours, and those in Asia, tomorrow.

The letter to employees from co-CEOs Dave Clark and Ryan Petersen opens: “We begin the new year with more optimism than ever about Flexport’s future.”

But it goes on: “We must also make hard decisions necessary to set us up for long-term success.

“We are, overall, in a good position, but are not immune to the macroeconomic downturn that has impacted businesses around the world. Our customers have been impacted by these challenging conditions, resulting in a reduction to our volume forecasts through 2023.

“Lower volumes, combined with improved efficiencies as a result of new organisational and operational structures, means we are overstaffed in a variety of roles across the company.”

The letter adds that the company will be reducing its global workforce by some 20%, some 600 people.

Jobs are going in every department, across all geographies, but the company will continue to operate in all its regions, with no offices being closed.

US staff leaving the company will receive “12 weeks’ severance, six months extended healthcare, a 2022 bonus, equity vesting acceleration, including dropping the vesting cliff for those with six months or more of tenure, immigration support and the ability to opt into our alumni talent directory to help with future job opportunities”.

There are no details for other regions.

But the company is also adding jobs – some 350 to 400 engineering and software staff, as it focuses on efficiency and technology. It said: “2023 is going to bring extraordinary velocity – we are in the process of doubling our software engineering talent and moving to single-threaded business organisations to build world-class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers.”

Flexport said the slowdown would give it time to build up its technology, so that when the economy recovers “we’re going to need to be nimble, fiscally responsible and focused on building fast with operational excellence”.

(The full letter to employees can be read here.)