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Shopify CEO Says 'I Was Wrong' - Now We Have To Lay Off 1000 Employees

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The company has announced that Shopify has laid off 10% of its staff. 

The move will affect around 1,000 of its employees, according to a report through The Wall Street Journal. 

In a memo published on Shopify's site, the CEO Tobi Lutke explains that the business "has to undergo the process of reducing its workforce," 

which mainly affects employees employed in recruitment, support and sales.

Lutke states that the online firm is also cutting back the number of "over-specialized" and redundant roles, as well as "groups that were useful to have but were too away from creating products." 

Lutke blames the layoffs on an uninformed assumption that the e-commerce market would continue to expand beyond the COVID-19 pandemic.

As reported by the WSJ, WSJ reported that Shopify's staff would grow between 1,900 and 10,000 by 2021 to accommodate the anticipated growth. 

However, Lutke states that the situation is "reverting to the same level as before Covid data suggested."

"Ultimately, the decision to place the bet I did was my choice to make, and I did this wrong," Lutke writes.

In the process, we must end our relationship with some of you, and I'm so sorry.

Lutke says that employees affected will be paid sixteen weeks' worth of severance compensation plus an additional week for each year that the employee worked for the company. 

In addition, Shopify will offer guidance for employees affected to find a new jobs.