Gojek sheds services, cuts 9% of its workforce

A week after its rival Grab laid off 5 percent of its workforce, Indonesian ride-hailing and delivery startup Gojek is turning to downsizing as well. In a statement earlier this week, the company said it will be laying off 430 jobs or 9 percent of its employees, mainly from the team at its Indonesia headquarters. The jobs will be cut from some of its newer services including on-demand cleaning service GoLife and physical food court concept GoFood Festivals, both which had been hit hard by COVID-19 lockdowns and will be closed down as a result.

In an internal email sent to staff, Gojek co-CEOs Andre Soelistyo and Kevin Aluwi explained that the company is focusing on its core services—payments, transport, and food delivery—to weather out COVID-19, and shutting down verticals "that are no longer viable during this period".

Soelistyo admitted: "We had previously optimized the company for growth and impact and we imagined, naively, that the rate of growth would always accelerate. We didn’t plan enough for the inevitable downturn and we are paying for that now."

The affected employees will receive their full severance payments, including long service pay and payment of entitlements, and will retain their health insurance until the end of the year. They will also be allowed to keep their company-issued laptops. In addition, they will have access to support services for three months after their departure, including mental health support, financial advice, and an outplacement service.

According to the co-CEOs, this will be the only COVID-19 related layoffs.