Gojek Latest FinTech To Cut Jobs Amid Coronavirus Damage

Ride-hailing and digital payments firm Gojek is slashing hundreds of jobs as the coronavirus-triggered economic downturn hits home in Southeast Asia.

The Indonesian-based company confirmed the cuts in a statement to Bloomberg and various news organizations, noting that it would be eliminating 430 jobs. That amounts to 9 percent of the workforce of the tech company, which is headquartered in Jakarta and has a data sciences complex in Singapore.

The cuts are heavily concentrated in Gojek’s GoLife and GoFood Festivals divisions. These newer units will shut their doors in July as Gojek refocuses its efforts on its core offerings of digital payments, food delivery and transportation.

In an email to employees, the company’s co-CEOs cited the high level of uncertainty amid the ongoing pandemic, which has boosted demand for services like food delivery, even as it has undercut the foundation for other services involving large gatherings and events.

“The biggest challenge is the level of uncertainty ahead and the hard fact that this will forever change how some of our businesses and products need to operate,” Co-CEOs Andre Soelistyo and Kevin Aluwi said in an internal email to employees on Tuesday (June 23), Bloomberg reported.

The cuts come amid a series of pay and compensation cutbacks designed to shore up the company’s core operations.

Top managers at Gojek had previously committed to donate a quarter of the salaries for a year in order to support drivers, merchants and other partners.

Gojek’s layoffs come on the heels of similarly large cuts at rival Grab. The $14 billion Southeast Asian ride-hailing startup said last week that it would cut 300 jobs, or just under 5 percent of its payroll.

“The company (Grab) has been in growth mode for so many years in many verticals, and it is necessary for it to make an adjustment to be more focused,” Jianggan Li, from Singapore-based tech venture consultancy Momentum Works, told Reuters.  “With sufficient capital in the bank account and eased competitive pressure, it should really focus on building the core services well to achieve profitability.”