Australian Unicorn Culture Amp lays off 8% of its workforce as it feels hit by the economic slump caused by COVID-19. With an overall strength of 446 employees, the Melbourne-based people and culture platform had to cut 36 jobs. According to the Australian Bureau of Statistics, the unemployment rate went from 5.2% to 6.2% between March 2020 and April 2020 . While some companies are laying off people, some are keeping mass job hires on hold.
Co-founder Didier Elzinga said that though they are still building products and working with customers, the pandemic has slowed the growth rate to about 50% of what it had predicted before COVID-19.
What the founders at Culture Amp say about the lay-off
Mr Elzinga says that the company made it a point at the beginning of the pandemic of not laying off anyone, but they got to the point where they had to figure out what the right size is for the company to move forward.
He says that they needed to make the Culture Amp team a little bit small. He adds that though it was not a life-or-death situation, in fact, he considers himself “lucky in a sense”, as they just had bagged a $120-million funding in September 2019 at a valuation of just about $1 billion. He says that they have a long runway and when he looks forward, he doesn’t how much longer it’s going to stay like this. “The plan is to be able to withstand that and last as long as possible,” says Mr Elzinga.
More about Culture Amp
Culture Amp is a people and culture platform that makes collecting and analyzing employee feedback easier for employers. It was found in 2009 and is based in Melbourne. Culture Amp works with around 2,750 companies globally with more than 2.5 million employees. Though there is a JobKeeper program in Australia, Culture Amp was not eligible for the same as turnover was only down 15% in Australia.
The JobKeeper Payment programme is the Australian government’s economic response to coronavirus. Under this programme, employees and workers are to receive a payment of $1,500 (before tax) through their employers.
Mr Elzinga said while companies like Culture Amp are not directly affected by the pandemic, they still have had to bear consequences of the economic slump. He added that they have customers that are going into bankruptcy and companies that had a staff of 20,000 that now had to cut down to 10,000.
According to the Australian Bureau of Statistics, 800,000 Australians have already lost their jobs as of April 2020. Though the Australian government is taking steps, like the JobKeeper programme, to support the citizens, the economic slump might affect businesses in the coming days.
 Australian Bureau of Statistics (2020) “6202.0 – Labour Force, Australia, Apr 2020” [Online] Available from: https://www.abs.gov.au/ausstats/abs@.nsf/mf/6202.0 [acessed May 2020]
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