Startups’ Layoffs Continue to Level Off Despite COVID-19 Pandemic

When the COVID-19 pandemic began, many startups radically adjusted their operations in order to stay alive. Sometimes that meant budget cuts, or mothballing certain lines of business; and in other cases, that meant layoffs.

Since the beginning of the crisis, layoffs.fyi has been crowdsourcing startup layoffs. As we head into August, it seems like there’s some good news: layoffs seem to be leveling off. Check out this chart of overall layoffs, by month:

Some cities, however, have been hit much harder than others (San Francisco in particular):

Again, this data has been crowdsourced, which means you can take issue with its accuracy. For example, when a “startup” like Uber lays off thousands of employees (we use “startup” in quotes because Uber, as a publicly traded company that makes billions of dollars per year, probably doesn’t qualify as one, even though it’s often referred to that way), there’s a good chance that word of those cuts will trickle back to layoffs.fyi. On the other hand, smaller startups may lay off employees and even shut down without the data ever ending up on the site.

In other words, we should probably treat this data as more of a snapshot than a definitive breakdown. But that being said, if the data is in any way accurate, startup layoffs have continued to level off after an initial surge at the very beginning of the pandemic. That follows the same trend that levels.fyi noticed in June. It’s potentially encouraging.

With regard to cities, it stands to reason that San Francisco and the Bay Area, as the incubators of so many startups, would disproportionally suffer in terms of nationwide layoffs. Uber, Airbnb, Yelp, Lyft, Juul, Intuit, Opendoor, and other startups in that area all endured either hundreds or thousands of layoffs. 

Despite those layoffs, though, many startups are still hiring. Firms that specialize in everything from robotics to cloud-based services, for example, all need highly skilled technologists. Many technologists are also seeing opportunity within the uncertainty, as Dice’s ongoing COVID-19 Sentiment Survey makes clear: Roughly a third of technologists who are currently employed full-time plan on looking for a new job sometime within the next two weeks. Many of these technologists might find their way to startups with an exciting idea.

If you’re one of those technologists interested in a new position during the pandemic, make sure that you adjust your résumé accordingly. Given how many companies are entirely work-from-home at the moment, it’s key to emphasize your remote work experience. Companies are also intensely interested in your efficiency with resources, as well as your ability to boost revenues or create new lines of business. These are all skills that startups everywhere demand.