Tech Layoffs reach China: TikTok-owner ByteDance planning to layoff thousands in coming months

It seems that big tech companies based out of China will finally start facing the music of global tech layoffs. ByteDance, the owner of TikTok and one of the biggest tech companies in China is reportedly planning to lay off thousands of its workers in the coming months. This news comes to us just days after ByteDance shut down its Indian offices and terminated all of its Indian staff. Although the Indian layoffs were majorly facilitated by ByteDance’s tussle with the Indian government, in China, the layoffs is taking place mainly due to an economic slowdown, dwindling growth and some wrong hedges the company had placed on a few of their projects. ByteDance’s reorganisation efforts As the firm continues to simplify operations in the face of severe competition in its market, TikTok owner ByteDance will transform its bimonthly staff goal-setting and evaluation, a management system that stimulates internal competitiveness, into a three-monthly procedure. By adjusting the timing of its objective-and-key-results (OKR) framework, ByteDance co-founder and CEO Liang Rubo stated that the Chinese tech unicorn expects to have more time “to reflect on truly meaningful progress” and “be more flexible” so that each business unit can “adjust its own cadence,” according to a report by the South China Morning Post. What this effectively means, is that ByteDance will be streamlining its efforts and will be shutting down some projects that they think will not be viable in the short term. With projects being shut down, ByteDance will also start laying off a sizeable portion of its workforce of 1,00,000 employees. Various reports that have surfaced recently, quote an insider at ByteDance as saying that the company may lay off over 10,000 people by the second quarter of this year, if things don’t improve. A new direction The decision to undertake quarterly OKR evaluations underscores ByteDance’s desire to improve its operational adjustments in the wake of recent reorganisation efforts. ByteDance began layoffs impacting hundreds of staff at its virtual reality headset business Pico, after slashing hundreds of positions across several divisions at the end of 2022, as TikTok terminated its remaining employees in India. ByteDance boss Liang told employees in December that the company needs to “get fit”, as it streamlines operations. That comment came months after CFO Julie Gao stated that the business had no plans to go public, after months of speculations that ByteDance would have their own IPO. Also read: AI frenzy: Chinese tech firms are scrambling to make AI generative bots like ChatGPT The new OKR review timetable also comes as ByteDance continues to into new areas. ByteDance-owned Douyin, the Chinese equivalent of the popular worldwide short video service TikTok, has been aggressively expanding into several parts of the Meituan-dominated on-demand e-commerce services industry. With Haomo, the company is also expanding its artificial intelligence efforts. Great Wall Motors chairman Wei Jianjun controls AI Technologies Co, which is establishing the country’s largest specialised processing centre for autonomous driving. ByteDance’s tussle with Europe and the US Because of security worries over TikTok, ByteDance is facing increasing political pressure in the United States and other key Western markets. TikTok has been trying desperately to pacify the EU that they are taking privacy seriously and will work closely with officials to safeguard users. TikTok risks getting banned in the EU as well as the US. Also read: US universities continue to ban TikTok from campus networks and devices Meanwhile, in the US, ByteDance’s social media app has been slapped with a device and network-wide ban in a number of universities, and over 20 states have banned the social media platform and other ancillary apps from devices and networks that it maintains. Chew Shou Zi, the chief executive of TikTok, is expected to give testimony in the US Congress about the app’s operations in late March. Also read: Wisconsin becomes the latest state to ban TikTok on govt. devices, also bans other Chinese companies In India, ByteDance was trying to lobby the Indian government for years and get the ban on their apps revoked, but to no avail. We have a comment from a spokesperson of TikTok, about the layoffs:

We have taken the decision to close our India remote sales support hub, which was put in place at the end of 2020 to provide support to our global and regional sales teams. We greatly appreciate these employees and their impact on our company, and will ensure they are supported at this difficult time. 

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