Etsy Implements Workforce Reduction: Cuts 11% of Jobs Amid Cost-Cutting Strategy
Online marketplace giant Etsy is set to reduce its workforce by approximately 225 jobs, constituting 11% of its total staff, as part of a comprehensive cost-cutting initiative. The move will also witness the departure of several top executives, including the Chief Marketing Officer.
CEO Josh Silverman communicated the necessity of these cuts, citing stagnant sales over the past two years. Despite the unfortunate timing during the holiday season, Silverman assured affected employees of continued pay until at least January 2.
In a post on the company’s website, Silverman outlined the broader goal of making Etsy a “more focused, agile company.” The layoffs are expected to cost the company up to $30 million in severance payments, employee benefits, and related expenses, as disclosed in an announcement to investors.
The company anticipates completing the job cuts within the first three months of the upcoming year. Post-reduction, Etsy’s core marketplace team will consist of approximately 1,770 employees.
Etsy, founded in 2005, operates as an online marketplace enabling independent sellers to establish their own shops, specializing in bespoke items and handicrafts. The company, listed on the Nasdaq stock exchange since 2015, currently trades shares at around $84 each. Notably, this marks a significant drop from its record high of over $294 during the COVID-19 pandemic in 2021.
Major institutional shareholders of Etsy include Vanguard Group and BlackRock. CEO Josh Silverman, at the helm since 2017, has a diverse background with previous roles at eBay, Skype, and American Express.
The company faced scrutiny in August when it announced policy changes after sellers complained about funds being held. Etsy reversed its decision, substantially decreasing the amount and duration of funds placed on hold after some sellers reported having 75% of their money frozen for 45 days. The exact new rate and timeframe were not specified by Etsy.