May 19, 2024

Shopify’s Quiet Layoffs As Workers Fear More Cuts Amid AI Push

  • Shopify workers are worried about another mass layoff. 
  • The company has been quietly laying off workers in recent weeks. 
  • Layoff rumors have largely centered on its Support division, which is being impacted by AI.

Shopify workers are once again bracing for another mass layoff.  

Just three months after the Canadian e-commerce giant laid off 20% of its workforce and sold its logistics business, rumors are swirling that more cuts could be on the way. 

Shopify has quietly laid off a number of workers in recent weeks, with cuts coming to departments as varied as customer support, engineering, and marketing. Many workers in Ireland were also let go earlier in July.  

The timing of any potential layoff is unclear. Shopify reports earnings for the second quarter on Wednesday, after the markets close. 

Company representatives did not return Insider’s request for comment. 

Much of the chatter around potential layoffs has centered on Shopify’s Support org, which is responsible for troubleshooting issues for the company’s millions of merchants. Shopify began using more third-party vendors — many based in the Philippines — to handle customer-support inquiries last year. In March, it declared a “Code Yellow” for the Support division, saying that customer-service levels had “deteriorated beyond acceptable ranges.”

Internally, Shopify recently shared details about its plans to incorporate AI into more of its customer-support experience.  

The goal, executives said during a recent town hall, is to make it easier for merchants to get answers to simpler questions without having to involve Shopify employees unless necessary. This may mean that support advisors’ overall work volume decreases, but that the time they spend on each case increases.

The tone of the updates spooked employees. One Support employee told Insider that after viewing the town hall, they felt their firing would be inevitable. 

During a question-and-answer session at the end of the town hall, an employee asked how support advisors could be reassured that their jobs are safe. Shopify’s first round of layoffs last July hit its Support division hard, and the company conducted a second round of layoffs in May. The second round affected 20% of the workforce, or more than 2,000 people, across Shopify. 

In response to the question, executives encouraged employees to sharpen their skills. 

“In all fairness, I don’t think any technology company — or any company, for that matter — would be in a position to guarantee that everyone will have their jobs, or that every single job is going to be completely safe. I think all of us, myself included, we’re constantly proving ourselves every single day in our jobs,” Clovis Cuqui, Shopify’s vice president of merchant acceleration, said during the town hall, a recording of which was reviewed by Insider. 

“My encouragement here is always to lean in on how else each and every one of us can add value,” he said.  

Got a tip? Contact this reporter at mstone@insider.com, mlstone@protonmail.com, or on the secure messaging app Signal at (646) 889-2143 using a non-work phone. 

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