Shiftgig lays off a third of its staff
- Shiftgig is laying off 75 workers, Crain's Chicago Business reports, as the company seeks to "focus on technology-enabled clients and Chicago," according to a statement given to Crain's.
- Most of the eliminated jobs are outside of Chicago, Crain's says, and are largely sales and customer-support roles. The company expects to expand in Chicago sales, as well as engineering and operations.
- The company has made its name in the gig economy space by connecting ready-to-work talent with employers that need to fill gaps on-demand. It recently hired a new CEO, Wade Burgess, originally from LinkedIn, to forward this mission.
We've seen this pattern before with startups of all shapes and sizes, especially when new leadership comes on board. After obtaining new leadership, Zenefits (another HR-oriented startup) made a similar move, cutting chunks of the sales staff to focus on core company offerings. It is often part of the startup lifecycle.
Some of the jobs are expected to be automated out, according to the report, which just goes to show how pervasive automation has become. The key to watch here is if Shiftgig maintains sustainable growth post-layoffs by focusing on efficiency and a good company culture.
Either way, the solution Shiftgig offers likely won't be going away anytime soon. The contingent workforce has seen explosive growth. Contingent workers (think freelancers and contractors) are increasingly replacing full-time employees as employers struggle to overcome the skills gap and retain the right talent to get specific jobs done. Workers seem to enjoy the flexibility that it offers, though questions have arisen over benefits and other worker protections. Shiftgig side-steps the potential compliance landmines by having the workers' main relationship (and W2) be with Shiftgig, even as they are sent to various businesses and brands.
"To keep pace with the growth of the contingent workforce, we have decided to centralize our business operations in Chicago to better serve the needs of our clients and workers," Shiftgig emailed in a statement to HR Dive. "This commitment will help Shiftgig build products, support our clients and workers, and scale into new geographies and industries in a more focused and agile way."
- Crain's Chicago Business Shiftgig cuts a third of its payroll
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