This week, restaurant review giant Yelp ($YELP) sent 2,100 of its employees home. 1,000 of them were permanently laid off, and the other 1,100 were furloughed as part of an effort to reduce costs during the Coronavirus pandemic. Global stay-at-home orders have devastated the restaurant industry, and Yelp's position there has been rendered precarious at best.
"The physical distancing measures and shelter-in-place orders, while critical to flatten the curve, have dealt a devastating blow to the local businesses that are core to our mission,” Yelp co-founder and CEO Jeremy Stoppelman told his employees in a letter that informed them they no longer had jobs. The letter was also posted to Yelp's public blog.
Just a few weeks ago, ahead of the layoffs, Yelp cut its hiring efforts to near-zero.
On March 10, 2020, the company listed more than 160 openings on its careers site. By April 2, the company only listed 5 openings in a near HR shutdown. Of those 5 openings, 2 are focused on HR, 2 on finance, and 1 on Marketing.
|
Title |
Category |
As Of Date |
|---|---|---|
|
Senior Auditor, Technology |
Finance & Accounting |
20200405 |
|
Head of B2B Lifecycle Marketing |
Marketing |
20200405 |
|
People Operations Business Partner |
People Operations |
20200405 |
|
People Operations Coordinator |
People Operations |
20200405 |
|
Technical Analyst |
Revenue Operations |
20200405 |
Just 5 months ago, we reported on Yelp's rapid growth and bullish future, with expanding hiring and user engagement. We did notice a slight slump in app engagement, which may have played a part in the company's proactive move to cut overhead before it was too late. Yelp relies on ad revenue from restaurants, and it's not difficult to surmise that restaurant advertising has all but dried up.
According to its most recent annual report, Yelp employed closed to 6,000 people. But on LinkedIn, around 9,000 people list the company as an employer.
The discrepancy is likely related to consultants who have done contract work for Yelp. But, as seen in the chart above, the number of people listing the company as an employer is seeing a decline. In the coming weeks, as laid-off and furloughed employees update their LinkedIn profiles, we'll see this number plummet.
The entire hospitality industry has been hit head on by the Coronavirus lockdowns. Hiring at hotels has hit near-zero levels, and restaurants — especially those that haven't pivoted to delivery and pickup — have seen revenue dry up. Some companies, like ChowNow, have found opportunity and good will in the midst of the crisis, but for most, recovery can't come soon enough.
Further reading:
- Yelp is growing, engagement is rising - but there is one red flag in the data
- ChowNow's social engagement jumps 173% as it becomes the good-guy of ailing restaurant industry
- Hospitality hiring crushed by Coronavirus epidemic