PayPal, Block lay off 3500 global staff in the first month of 2024

Just one month into 2024 PayPal and Block have culled their staff numbers, leaving Australian tech employees nervous for the future of their jobs.

PayPal chief executive Alex Chriss has announced 2500 people will be axed globally. Picture: Peter Prato

Just one month into 2024 and lay-offs are landing hard and fast across big tech as companies cut as much as 10 per cent of their workforce.

Two fintechs overnight retrenched about 3500 workers in a global slashing that’s expected to affect the numbers of staff employed in Australia.

PayPal is laying off 2500 people from its global team – axing 9 per cent of its total headcount – in a move that chief executive Alex Chriss said would help “right-size” the company.

“Today, I am writing to share the difficult news that we will be reducing our global workforce by approximately 9 per cent through both direct reductions and the elimination of open roles over the course of the year,” he wrote in a message to staff on Tuesday local time.

Mr Chriss said he arrived at the decision after some months spent with different teams where he identified areas “where we need to move faster” and “where we need to change”.

Staff caught up in the lay-offs will be notified over the next two days.

“These decisions were not easy to make, and we are undertaking these actions with tremendous care and consideration,” Mr Chriss said.

The Australian contacted PayPal to ask how many Australian staff would be affected and what kind of severance they would receive. The company did not respond to those questions, but only referenced the message from Mr Chriss.

PayPal's mobile app. The company has announced significant staff cuts.

Block, the parent company of Afterpay and Square, which has thousands of payment terminals across the nation in all retail settings from florists to cafes and clothing stores, about 1000 people are understood to have lost their jobs.

Unlike PayPal, Block did not publicly share information about the job cuts. However, an internal memo sent to staff by chief executive Jack Dorsey was publicised by US media outlet Business Insider.

“Today our Cash App, Foundational, and Square teams are parting ways with a large number of our teammates,” it read.

At Cash App, lay-offs would affect global, marketing and commerce teams; at Foundational it would include a restructure, centralisation and reduction in management; and at Square it would affect marketing, creative and product marketing manager teams.

Explaining “why is so much happening in one single day”, Mr Dorsey said all three teams were ready within the same two to three-week period.

“When we know we need to take an action, we want to take it immediately, rather than let things linger on forever,” he said.

By the time the message reached all staff, those who had been laid off would have already been notified, the note read.

Jack Dorsey’s Block is “parting ways with a large number of our teammates”. Picture: Getty Images

In its earnings report last year, Block said it would impose a staff cap of 12,000 by the end of the third quarter, and that “we believe constraining team size will enable us to be more effective”.

“We expect to hold firm at 12,000 people until we feel the growth of the business has meaningfully outpaced the growth of the company,” it read.

The Australian has reported extensively on lay-offs in the tech industry, including analysis of the kind of severance packages received.

Departure pay has varied anywhere from the national minimum of four weeks – for workers who have been with a company for no less than 12 months – to as large as 16 weeks, with many workers in remote roles gifted their work laptops and other devices.

Neither Block nor PayPal have publicly said how much staff would receive and when that pay was due.

Online marketplace eBay has also begun the year with a slashing of roles, laying off almost one in 10 staff across its global operations.

Staff were told to work from home in the US last week as the company decided which roles would be axed and who got to keep their position.

The company needed to “consolidate” so that it could become a “focused, agile, and responsive eBay”, chief executive Jamie Iannone told staff.

“While we are making progress against our strategy, our overall headcount and expenses have outpaced the growth of our business,” he said.

Last week’s lay-offs were the second round of major cuts at eBay. The first took place near nine years ago in 2015 when the company split with PayPal, which it had acquired in 2002. At the time it cut 2400 people which was then around seven per cent of its workforce.

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