Ouch: FedEx is planning to lay off 10% of workers, mainly directors and officers.

FedEx is one of the transportation and e-commerce companies in the world and will lay off some of its staff. According to the reports, FedEx will lay off 10% of its directors and officers in their bid to cut costs.

Why is FedEx cutting jobs?

The decision to lay off directors and officers was made by the CEO, Raj Subramaniam, after frantically cutting costs since last year in a bid to rescue profits. This process is a serious one, ensuring that we remain competitive in this rapidly changing environment, which requires making some difficult decisions. The primary reason highlighted by the CEO for cutting jobs, along with some team consolidation, is to see that the company remains competitive and agile.

How many people will be affected?

FedEx is undoubtedly a big company that should have a lot of workers. The company is said to have more than half a million workforce, and the number of staff affected has yet to be discovered. But with the percentage, thousands of people will be affected by the layoff.

FedEx is said to have reduced its US staff by more than 12,000 workers through attrition and headcount management initiatives since June 2022, which was the start of its fiscal year.

More on FedEx

The company has been frantically cutting costs for several months, and at the end of the pandemic, the e-commerce boom reduced the revenue.

Raj Subramaniam also said the company had an extra cut of about $1 billion at the end of last year, which brought their total expected amount in the fiscal year to $3.7 billion.

The cuts came from FedEx's express business, which covers overnight and next-day time-definite deliveries. Also, there will be further cuts to some expensive Sunday services.

The words from FedEx CEO, Raj Subramaniam

Please read the entire words from the FedEx CEO, Raj Subramaniam sent a memo to his team addressing the layoff.

Team,

As you know, we have embarked on a transformation effort to create the world's most flexible, efficient, and intelligent supply chain for our customers. This process is critical to ensure we remain competitive in a rapidly changing environment and requires some difficult decisions.

Today we inform several team members across our global enterprise that their roles have been eliminated as we reduce the size of our director and officer team by more than 10% and consolidate some units and functions.

We are saying goodbye to longtime colleagues and friends whom we value and respect, which is sad to do. Unfortunately, this was necessary to become a more efficient, agile organization. 

It is my responsibility to look critically at the business and determine where we can be more robust by better aligning the size of our network with customer demand. 

While we have already taken many actions to that end, it was necessary to also look closely at the size of our leadership team and the functions that could be consolidated.

I am sincerely grateful to those departing for their role in building FedEx. We are committed to a transparent and supportive transition. 

Our HR team will be in touch with them today with information on the next steps, including outplacement services, benefits, and severance compensation.

At FedEx, we have a rich 50-year history of evolving to meet the needs of a dynamic market. We have changed the way the world does business. I am equally confident in our ability to continue driving the world forward for the next 50 years and beyond.

Thank you for being so committed to our transformation.

Raj Subramaniam

President and Chief Executive Officer

Every big company laying off its staff has many reasons for making such decisions, and we have seen what FedEx has to say about cutting 10% of jobs among over half a million staff.

Remember that this layoff started with Twitter, and we later saw Meta, Google, Chipper Cash, Splunk, Zoom, Amazon, and many others who decided to lay off some of their staff.