WeWork Layoffs 2019: 4,000-6,000 Employees To Lose Jobs Over 5 Years

Attenuated shared spaces firm WeWork plans to shed up to half of its remaining 12,500 strong global workforce, which calls itself "WeWorkers," over the next five years as it strives to stave-off bankruptcy.

The WeWorker firings will begin this week and an announcement will be made Tuesday. The company's streamlining plan will see it fire up to 2,500 employees in its core business of subletting office space. More than 1,000 other employees will later be cut as WeWork sells or closes down noncore businesses, New York Times reported.

In addition, some 1,000 building maintenance employees will be transferred to an outside contractor in an outsourcing move widely criticized by employees. Together, the employees to be fired comprise a third of the 12,500 people WeWork employed at the end of June. Other sources, however, claim WeWork will actually fire a total of 6,000 employees, or half its remaining employees.

The turmoil forced remaining WeWorkers to band together into a group called the WeWorkers Coalition, which is fighting for equitable severance packages for departing employees, among other things. As can be expected, the massive firings are demoralizing the survivors, who aren't certain if they'll be the next to receive pink slips.

Online posts by surviving WeWorkers revealed their fears more of them will eventually lose benefits or be forced to work different schedules. They were also alarmed about outsourcing, saying the move by WeWork into this job-killing option was "like being informed of a death in the family."

Other WeWorkers said the appearance of outsourcing proves the company's new owners, Japan's SoftBank Group Corporation, is totally unconcerned about employee welfare and is making decisions based on what will save the company the most money.

SoftBank, which is WeWork’s largest shareholder, in October announced a plan to bail out WeWork and is now trying to stabilize the business. Progress in this stabilization is being hamstrung by the tepid sales of millions of dollars worth of WeWork bonds.

On November 6, SoftBank reported a $9.2 billion write-downs on its investments in WeWork. This amount is 90 percent of the $10.3 billion SoftBank invested in WeWork over the past few years.

Under the former management team led by ousted CEO Adam Neumann, WeWork lost $1.25 billion from July to September. This huge amount was more than twice as much as WeWork had lost in the same period in 2018. The company said many of its new locations are losing money and depleting WeWork’s cash. The company had only $2 billion at the end of September.