Uber Cutting 10% of Staff to Shift Spending to Robotaxis

Uber is reportedly cutting roughly 3,300 jobs, or 10% of its total workforce.

That’s according to a report Wednesday (Sept. 2) from Bloomberg News, which characterizes the cuts as a “massive restructuring” designed to shrink management and shift spending to Uber’s ride-sharing, delivery and robotaxi units.

CEO Dara Khosrowshahi announced the cuts in an email obtained by Bloomberg, saying that Uber’s growth in recent years has led to “more layers, more coordination, more fragmented ownership, and in some cases structures that made sense when businesses were smaller but no longer serve us well at our current scale.”

The cuts will mean a 20% reduction in the number of managers at Uber, with some taking on the role of individual contributors, an Uber spokesperson told Bloomberg. But the company did not say what percentage of managers would lose their jobs, and the cuts also include non-managerial positions, the report said.

To make Uber “simpler and faster,” it is reducing the number of “micro-teams” with one or two members by about 50% and scaling back the number of employees who sit more than seven layers down from the CEO, Khosrowshahi said.

The company is also streamlining its core engineering, science and delivery groups, which means combining its operations teams for restaurants, retail and white-label delivery. As part of an effort to have more employees working in-person, Uber also said that only around 1% of workers can now be remote, the Bloomberg report added.

Uber earlier this year cut 23% of its “People” division, which constitutes its recruitment/human resources arm. Those cuts applied to less than 1% of the company’s total staffing.

These newest cuts are part of a larger wave of tech industry layoffs this year, a trend driven in part by record spending on artificial intelligence (AI).

As of late July, tech companies had cut around 140,000 jobs, a figure that accounted for more than a third of this year’s announced layoffs in the U.S. Roughly 50,000 of those cuts came from Amazon, Oracle, Meta and Microsoft, companies that—along with Google—are projected to spend more than $800 billion on AI-related initiatives this year.

Meanwhile, a report last month by Goldman Sachs found that—in addition to driving layoffs—AI was also leading companies to rethink their hiring.

“We find that industries with greater exposure to AI automation are associated with slower job openings growth since the second half of 2022, with a more negative relationship in Germany, Australia, and the U.S.,” the bank’s report said. “This cross-industry result confirms our prior finding that the onset of generative AI tools may have led companies in highly exposed industries to reevaluate their hiring plans.”