Good morning!
We kicked off the week with yet another tech layoff announcement. Twilio CEO Jeff Lawson announced Monday that the company would cut 1,500 jobs, about 17% of its workforce, just five months after it dismissed 11% of employees, citing too fast growth. Also on the chopping block: some flashy employee perks that became staples during the pandemic. The move speaks to a broader industry trend of employers cutting costs by revoking the same lavish benefits once used to attract and retain employees.
According to Lawson, the company will no longer provide its signature book and wellness benefits. It previously offered employees a $30 monthly book allowance and a reimbursement for wellness expenses. Most notably, the company also rolled back its Twilio Recharge program, a perk that allowed employees to take a four-week paid sabbatical every three years. Twilio declined to comment on the matter.
While Lawson stated that he fully supports the sabbatical program, he wrote in his memo that, in retrospect, it "was ill-timed given our profitability goals.” Employees who are already eligible, or are to become eligible for the program this year, will still be able to take it.
Though it’s debatable whether layoffs are the big cost-savers leaders believe them to be, scrapping perks and benefits has become low-hanging fruit in the face of economic uncertainty. TikTok, Meta, and Google have all cut perks like free laundry and meal stipends, and Salesforce announced that it would cut its monthly paid day off starting in fiscal year 2024. Netflix also notoriously cut down on the free corporate swag employees can access.
It doesn't just stop at traditional perks. "A July survey from Gartner found that 72% of chief financial officers plan to cut real estate and facilities management budgets by the end of the year, the highest of any corporate function," wrote my colleague Paige McGlauflin in a 2022 piece for Fortune.
Twilio plans to do the same, stating it will close some of its offices due to low attendance. For employees who consider escaping to the office a perk, this is yet another cutback.
Amber Burton
amber.burton@fortune.com
@amberbburton
