Ride-hailing firm Lyft freezes U.S. hiring amid downturn fears
© Reuters. Lyft logo is seen in this illustration taken June 27, 2022. REUTERS/Dado Ruvic/Illustration/Files
(Reuters) -Lyft Inc is freezing all hiring in the United States through the end of the year, a company spokesperson said on Tuesday, making the ride-hailing firm the latest to pause recruitment as high inflation forces cost-cutting measures.
The company, which in July cut nearly 60 jobs in its rental division, has been battling surging expenses as U.S. inflation reaches levels not seen in four decades. As of June 30, Lyft (NASDAQ:) had nearly 5,000 employees, according to its latest quarterly filing with the Securities and Exchange Commission.
San Francisco, California-based Lyft said its costs jumped 36% in its most recent quarter.
Several tech companies have been forced to slash headcount in recent months, with Lyft’s larger rival Uber Technologies (NYSE:) Inc also scaling back hiring and cutting marketing spend.
Lyft posted a record quarter in August on the back of soaring demand for rides and gains from its cost-cutting efforts.
However, the company warned challenges would persist in the third quarter due to high insurance costs, macroeconomic uncertainty and inflation.
A broad sell-off in markets due to red-hot inflation and fears of a looming recession have crushed risky assets this year. As of Tuesday’s close, Lyft’s stock has dropped over 68% in 2022.
The hiring freeze plans were first reported by the New York Post.