Grubhub to Lay Off About 15% of Workforce to Reduce Costs

ByLA STARTUPS

Grubhub, a prominent food-delivery service, has announced that it will lay off approximately 15% of its workforce in an effort to curb escalating costs. The decision, which impacts around 400 employees, was announced by the company on Monday.

The CEO, Howard Migdal, explained in a memo to employees that despite the business growth since pre-pandemic levels in 2019, the operating and staff costs have surged at a higher rate. He stated, “These changes, while difficult, will help ensure we have the right resources and structure to focus on the business priorities and opportunities ahead.”

The news of the layoffs first surfaced in the Wall Street Journal. The job cuts reflect the ongoing turmoil at the Chicago-based company. Grubhub’s former CEO, Adam DeWitt, resigned in March. The company, which is a subsidiary of Amsterdam-based JustEatTakeaway.com NV, has been grappling with competition from rivals like DoorDash Inc. and Uber Technologies Inc.

Despite the sustained demand for takeout even after the pandemic boom, Grubhub has been losing ground. As of April, Grubhub and its subsidiaries, which include Seamless and Eat24, accounted for only 9% of US meal delivery consumer spending, according to Bloomberg Second Measure.

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