[Asia Economy Reporter Kwon Jae-hee] Alibaba, China's largest e-commerce company, reportedly laid off a total of over 13,000 employees in the first half of the year, including about 9,000 in the second quarter alone, according to the Hong Kong South China Morning Post (SCMP) on the 6th.
This is attributed to regulatory pressure from Chinese authorities on the information technology (IT) sector and the impact of COVID-19 lockdowns.
With a total reduction of 13,616 employees in the first half, Alibaba's total workforce stood at 245,700 as of June 30. This represents about a 5% cut in the first half compared to the beginning of the year.
SCMP reported, "The decrease in the number of Alibaba's payroll employees is the first since March 2016," adding, "The workforce reduction is part of efforts to cut costs and improve efficiency amid ongoing regulatory pressure and the slowdown of the Chinese economy."
Just a year ago, Alibaba was expanding its workforce by growing businesses such as the fresh food supermarket Hema Xiansheng.
However, due to the continued 'Zero COVID' policy leading to a consumption slowdown and strong regulatory measures by authorities, layoffs were implemented. Reductions were made in business units including Taobao, Alibaba Cloud, and Dingding.
On the 4th, Alibaba announced that its net profit for the second quarter was 22.74 billion yuan (approximately 4.37 trillion KRW), a 50% decrease compared to the same period last year.
Cheng Yu, an analyst at Kandong Research, forecasted, "Alibaba can increase profits by reducing some employees and non-core activities and focusing on core businesses."
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