back to article Everyone's doing it: PayPal sends 2,000 workers packing

Online payment service PayPal says it intends to cut about 7 percent of its workforce, or around 2,000 jobs, in the latest cull to hit the tech sector. The Dotcom era veteran said the decision was a result of focusing resources on its "core strategic priorities." In a statement, president and CEO Dan Schulman said the …

  1. Anonymous Coward
    Anonymous Coward

    I'm not sure

    I'm not sure the trend is quite as it seems. Isn't it more the case that some big companies are more in trouble than others? So fashions and politics are changing so Facebook and Twitter (for different reasons) are in trouble and here we see PayPal cutting back but that may simply be that it no longer offers the advantages it once did. Some years ago I used it a lot as it was an easy way to pay but now I often use my credit card directly as more and more sites (at least those where I buy stuff) offer that as an option.

    My point is that these companies and the likes of Google have problems that in some ways are quite specific to them and not necessarily a simple reflection of the market for IT professionals.

    1. Charlie Clark Silver badge

      Re: I'm not sure

      There's a bit of "employer's remorse" in companies probably taking on more employees during the era of easy money pandemic than they needed long term. But this is also a fairly typical response of listed companies with slack revenues: reducing the headcount makes the financials look better and keeps investors happy; this also ensure stock options vest. But we also need to remember that all capital intensive companies are particularly sensitive to changes in monetary policy: in the last twelve months, financing costs have gone from essentially zero to "significant". This was a long overdue correction but I've never met a capitalist who didn't cry fowl when debt-based financing no longer offered a premium over cashflow.

      1. elsergiovolador Silver badge

        Re: I'm not sure

        reducing the headcount makes the financials look better and keeps investors happy

        There is that one simple trick that investors hate - let go of employees, bring in the contractors!

        They typically don't make into a headcount.

        1. Charlie Clark Silver badge

          Re: I'm not sure

          Creative accounting does the rest: headount includes future liabilities, contractors are operating expenses.

          Juicing the numbers with this and other things like bringing sales forward, setting investments back are standard manipulations for companies aiming for specific targets, then there are all the carve outs, reassignment of profits to subsidiaries, etc. GAAP was supposed to make things easier…

      2. FishCounter

        Re: I'm not sure

        My wife warned me when I entered private sector and worked in a public company that my ONLY job (regardless of my actual profession) was to increase shareholder value. I didn't believe it, but have seen too many decisions made to deliver double-digit returns to investors no matter what.

    2. AMBxx Silver badge

      Re: I'm not sure

      Ebay switching away to their own payment service won't have helped either.

      1. MachDiamond Silver badge

        Re: I'm not sure

        "Ebay switching away to their own payment service won't have helped either"

        That and Paypal's continued Woke agenda is not doing them any good. They'll freeze accounts if they don't like a vendor you've purchased from and their contract clause that had a massive fine for posting a comment they don't agree with isn't a good look even if they did walk that one back (expect them to try it again when nobody is looking). A financial company needs to be neutral. As long as a customer is acting within the law, they should keep their nose out. I've dropped my Paypal account and long since decoupled all bank accounts from them going as far as closing those bank accounts and opening new ones. I had a dispute with an eBay customer that decided they wanted their money back and wanted to keep the stuff too and Paypal fetched the money back from my bank account. That wasn't going to happen twice.

        1. Anonymous Coward
          Anonymous Coward

          Re: I'm not sure

          This ability to reach into your bank accounts without permission, is a very strange peculiarity of the US system.

          1. Someone Else Silver badge

            Re: I'm not sure

            For the (very) short time I had a PayPal account, I backed it with a credit card. That way, should any shenanigans like that be attempted, I can challenge the charge, and put the onus on the CC company to wrastle with PayPal. Never did have to engage that before I simply punted PayPal. Not sure if that is even allowed anymore; if it isn't, the YAN reason to forgo PayPal.

          2. MachDiamond Silver badge

            Re: I'm not sure

            "This ability to reach into your bank accounts without permission, is a very strange peculiarity of the US system."

            The ability is granted by the agreement you ... agreed to when you signed up. Paypal being able to recover disputed funds directly from your attached account is part of the contract.

    3. Zippy´s Sausage Factory
      Devil

      Re: I'm not sure

      I think it's basically been done by so many companies now that big institutional investors are talking to CEOs saying "where's your layoffs - we need to reduce costs so we can improve profits". I can imagine them rubbing their hands together like Tod Slaughter* in a 1930s melodrama.

      * just look him up on Wikipedia, you'll see from the first picture exactly what I mean.

    4. ecofeco Silver badge

      Re: I'm not sure

      To quote:

      https://www.latimes.com/business/technology/story/2023-01-30/column-how-big-tech-is-using-mass-layoffs-to-bring-workers-to-heel

      “Controlling labor costs via periodic layoffs is like breathing for Silicon Valley: cyclical, necessary for life,” Malcolm Harris, author of the forthcoming book “Palo Alto: A History of California, Capitalism and the World,” told me. The layoffs, Harris says, have “very little to do with long- or even medium-term strategy except as it pertains to cultivating an insecure workforce.”

      1. MachDiamond Silver badge

        Re: I'm not sure

        "The layoffs, Harris says, have “very little to do with long- or even medium-term strategy except as it pertains to cultivating an insecure workforce.”"

        I'd love to see the reasoning behind keeping a workforce insecure. Security is something most people crave. If I feel that my employer is somewhat likely to send me on my way at any time without notice, I'd be happy to take a job with a competitor for a 10% rise in compensation without thinking twice. No loyalty in either direction. I used to have a bunch of employees and training new people was always a big chore and it took time before those people were contributing enough to cover their payroll cost.

        I get the feeling that too many bean counters fail to take into account the cost of adding employees back over keeping people through slow downs. Time is a big factor too. If business picks up, training new people and increasing production takes far longer which can lead to missed opportunities.

  2. Steve Button Silver badge

    They can go to the wall.

    After they suspended the accounts of UsForThem (A charitable group supporting children's rights to stay in school) and The Free Speech Union (oh, the irony) for saying things that they didn't approve of (anti lockdown), I closed my PayPal account. I wrote to the UK CEO and others but heard nothing back. As far as I'm concerned they can burn.

    If I ever come across a site which only accepts PayPal for payment, I'll be shopping somewhere else. They have earned a lifetime ban from me.

    And as far as Alphabet / Google are concerned, they can also burn. They are currently suppressing a Project Veritas video where a Pfizer exec openly acknowledges they are carrying out gain-of-function research to get ahead of the game for the next variant of Covid. But you, dear commentard, probably don't know that because you are stuck in the Google Sphere. Interestingly Snopes doesn't seem to be able to find a digital presence for Jordan Trishtan Walker. Guess they have never heard of archive.org?

    1. hoola Silver badge

      Re: They can go to the wall.

      Is this the organisation "Project Veritas"?

      https://en.wikipedia.org/wiki/Project_Veritas

      If so then they are not exactly a example of accuracy, restraint and moderation.

      1. Steve Button Silver badge

        Re: They can go to the wall.

        Yes, that's the one. I can see they have put out some dodgy content in the past, but it does look like in this particular case it's something to take a bit more seriously. Unless they actually staged the whole thing completely, which I suppose is possible but doesn't seem very likely. The guy seems to have disappeared from the internet (LinkedIN for example) although you can see that he did appear to work for Pfizer if you look on archive.org. If the whole thing is staged, then they have gone to GREAT LENGHTS to make it look genuine. I'm trying to keep an open mind.

        With Wikepedia describing them as "far right" it does seem a bit excessive. What does that mean exactly? Anything to the right of Bernie Sanders? It does seem that Wikipedia have been taken over by the "progressive" left, and as someone down the middle I tend to distrust them too.

        I guess you just trust all the Big Tech companies and they have all our best interests at heart, after all "Don't be Evil".

        Even Snopes aren't actually discrediting this story.

        1. Steve Button Silver badge

          Re: They can go to the wall.

          ... and anyway, that's not really the point. That's just one story. You do realise that Google and other tech companies are suppressing stories that they don't like. Something like 97% of Google employees in Cali vote democrat, so you can probably guess which stories they are censoring? This is pretty sinister, but it's hardly surprising is it? The temptation to just "tinker" a little is too much. They have got WAAAY too much power.

          1. John H Woods Silver badge

            Re: They can go to the wall.

            They may well be just censoring misinformation, that does tend to disproportionately penalize the Right these days.

            1. M.V. Lipvig Silver badge

              Re: They can go to the wall.

              Yes, and their definition of "misinformation" is anything pro-right. There's been plenty of pro-left misinformation that passes muster.

              1. MachDiamond Silver badge

                Re: They can go to the wall.

                "Yes, and their definition of "misinformation" is anything pro-right. There's been plenty of pro-left misinformation that passes muster."

                No politician is to be trusted. There is no downside to lying (not much anyway) so they'll spin as many "campaign promises" that they need to so they get elected/re-elected. Their goal is money and, just as important, control over even more money. Once past the local level, I almost never see any politicians with altruistic traits.

    2. John H Woods Silver badge

      Re: They can go to the wall.

      Us for them were an opaquely funded pressure group masquerading as a charity.

      1. Steve Button Silver badge

        Re: They can go to the wall.

        They are funded by donations (still are, not were), and they are just a bunch of parents who just wanted to keep kids in school. I feel like taking children out of school for many months was one of the most damaging and unnecessary aspects of lockdown.

        The vast majority of people I speak to in the UK agree with that now, along with the ridiculousness of closing gyms, swimming pools and even beaches.

        Perhaps in the US not so much, as I hear some of the craziness is still happening (like vaccinating babies for Covid, and forcing kids to wear masks). Over here you don't get offered the vaccine if you are under 50 years old, and masks went away about a year ago.

        And anyway, what's your point? Because someone is "opaqualy funded" and a "pressure group" PayPal should have the right to steal their funds, and shut down the account?

        1. Anonymous Coward
          Anonymous Coward

          Re: They can go to the wall.

          Outside of the USA, Singapore's anti-terror funding laws made PP shutdown enormous numbers of accounts for pretty flimsy reasons. It was obviously done automatically by a crude keyword search.

          It had nothing whatsoever to do with ideological preferences, they are just a big lazy corporation, don't have many customer service staff, and you have no recourse.

          Nett result: it is easiest for them to just shut stuff down wholesale.

          The more that people (and legislators) bleat about bias from customer service / vetting staff, the more companies will do an Elon, and just fire those staff, let machines do whatever the feel like, and leave customers with no recourse.

        2. John H Woods Silver badge

          Re: They can go to the wall.

          Nope, they have strong ties to antivax. And in the end, there's a lot of rubles behind that.

          Lockdowns were not ridiculous however much you and your biologically ignorant friends might agree that they were.

          If C19 had turned out to be as remotely dangerous as some other SARS, it would have been a disaster. Similarly if we didn't have vaccines we would now be facing more lockdowns. Just have a look at how bad the situation is in China because they have insufficient vaccination.

  3. chivo243 Silver badge
    Coat

    Big Tech

    These are tech companies, and they have probably automated a lot over the years, and now are realizing that "Hey, we can do it with less employees and save money!" Thanks for your help, there's the door, don't let it hit you on the ass on the way out!!

    I once worked for a big faceless corp 30+ years ago, never again...

    1. Steve Button Silver badge

      Re: Big Tech

      I'm a contractor, so I'm happy to let pretty much anyone pay me money in return for work. And no sour grapes when they decide they no longer need me. I'll go somewhere else. I would even take money from PayPal, but I just won't be giving them any of my money. I draw the line at actual dictatorships, but some of the Big Tech companies are starting to get pretty close. ;-)

  4. elsergiovolador Silver badge

    Cooling

    Then the same companies, in few months' time, will be complaining there are shortages of workers and demanding from government "to do something" aka bring in more immigrants.

    1. ecofeco Silver badge

      Re: Cooling

      You are not even exaggerating. They've done it many times in the last.

  5. Randy Hudson

    Why in the world does PayPal need 30,000 employees to build a website consisting of a simple form with a submit button?

    1. hoola Silver badge

      Possible because (in my experience) if you need to contact them particularly by phone or chat, you get an answer pretty quickly.

      Customer service costs money.

    2. doublelayer Silver badge

      Why, whenever there is an article about companies with many workers is there somebody to post a question like this that completely ignores what the business actually involves? Can you make an HTML form? Great. So can I. Now I'd like to see you figure out legal compliance to serve as a financial company in nearly every country which works with each country's tax authorities automatically so businesses can use the thing. Try doing that on your own. Which part do you think is harder?

      I'm sure some employees of the company are unnecessary. That doesn't change the fact that their technology is more complex than a single form and that their business is more complex than a UI and a database.

  6. trevorde Silver badge

    Meanwhile at Oracle...

    [Larry Ellison] Fire all the developers, testers, tech support, sales and marketing!!

    [minion] But, but, but that will leave virtually no one...

    [LE] Hire more lawyers and license auditors! MWA, HA, HA, HA, HA!

  7. Persona Silver badge

    Back to normal?

    Before the pandemic lots of US firms "let go" their lowest performing 10% each year. It's not unreasonable. I have never worked anywhere were less than 10% of the staff were utterly useless.

    1. cmdrklarg

      Re: Back to normal?

      Stack ranking seems like a good idea, but it has been shown that doing so is actually highly detrimental to the organization due to employees sabotaging each other and generally fomenting bad morale.

    2. Anonymous Coward
      Anonymous Coward

      Re: Back to normal?

      A lot of this just looks like taking the opportunity and pretext for a cull since everyone else is doing it, we can get away with it.

    3. DS999 Silver badge

      Re: Back to normal?

      Sure but it is nearly impossible to identify those 10%? You might have felt 10% of your co-workers were useless, but maybe one of them was responsible for some function weren't fully aware of that was vital. Even if employees are able to identify that 10% you can't rely on them - because those 10% will be doing some of the evaluation, people will give a pass to their friends or use it as an opportunity to knife someone they dislike in the back.

      I wonder how long before someone tries to use ChatGPT to evaluate employees and choose those to be culled...

      1. ManMountain1

        Re: Back to normal?

        Not necessarily true but you do need a well devised and data driven process. We unfortunately had to make some people redundant a couple of years ago and went through a very thorough scoring exercise across about 15 attributes / behaviours which was also peer reviewed. One of the people who was made redundant had been the top performer against quota the year before but I am very confident in the process and genuinely think it was fair.

        1. M.V. Lipvig Silver badge

          Re: Back to normal?

          Making everyone else look bad, was he? I wonder how many years experience he had, and how much his salary came into play. "We can hire 3 Indians to do his job and still save money!"

  8. Anonymous Coward
    Anonymous Coward

    Who uses Paypal

    It's more costly and draconian than a credit card.

    Fuck those guys.

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Other stories you might like