The ongoing coronavirus pandemic has significantly affected the global travel industry; commercial airlines aren't flying, hotel bookings have decreased, and tourists are just staying home.
The online booking platform Airbnb has also been severely affected. And according to NPR's latest report, the company is planning to cut 25% of its workforce which will see 1,900 employees lose their jobs. If this happens, it will be one of the largest layoffs to hit Silicon Valley as a result of the pandemic.
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Brian Chesky, CEO and co-founder of Airbnb, stated in an email sent to employees on Tuesday, May 5, that the global pandemic has been the most harrowing crisis experienced by businesses around the globe. Airbnb's 2020 revenue is expected to be less than half of what the startup pulled in 2019 since the travel industry has been devastated by the coronavirus pandemic.
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1,900 employees of Airbnb will lose their jobs; 25% of its workforce will be out of jobs
In the NPR report, Brian Chesky described the challenges that COVID-19 has presented to Airbnb--one of the most valuable private technology companies in the US.
"You go from living year to year to month to month to week to week today," he Chesky. "You go from having multi-year plans to figuring out how you're going to get to next Thursday because you can't even predict what the world is going to look like in two months."
A total of more than 30,000 employees have been laid off by hundreds of startups companies since the outbreak started. However, experts said that the full extent of the effect of COVID-19 on the technology sector is still yet to come.
Airbnb is the latest high-profile tech company to buckle in the face of the coronavirus pandemic. The company employed 7,500 employees before the layoffs and was last valued at $31 billion.
When and how the traveling patterns will change is still uncertain. Chesky said in the interview that the future of Airbnb relies on his core belief that the Americans will continue to travel. "Traveling is not a trend that we rode. We didn't invent it," he said.
"There is a fundamental human need to explore. I think travel will be eventually much larger after COVID than before. It may take years," he further explained.
In the US, many of Airbnb's 650,000 hosts have seen their income crash. According to the report, almost half of Airbnb hosts are relying on their rentals to settle their mortgages and monthly rents. Some of the hosts are not satisfied with the $250 million host relief funds and other measures the company has taken.
Airbnb's statements reflect how the travel and hospital industry is currently suffering as the pandemic continues. The new figures provided by the hospital industry tracker STR show that about 74% of hotel rooms in the US are now empty.
