Etsy CEO Josh Silverman has confirmed that the company will be laying off approximately 225 employees, representing 11% of its workforce, marking the first significant staff reduction in recent years. The company is also reorganizing its leadership, with two top executives departing at the beginning of 2024.
The decision to downsize comes as Etsy faces challenges related to consumer spending, with Silverman acknowledging the difficult environment for discretionary spending. The company’s revenue growth has stalled in the wake of changing consumer habits following the pandemic.
In addition to external challenges, Silverman pointed to the impact of competitors Shein and Temu on Etsy’s bottom line. These upstart companies have not only taken away market share but also led to increased advertising costs for Etsy.
In response to the competition, Silverman outlined plans to emphasize Etsy’s “quality, value, and reliability” as a way to set the company apart from its rivals. However, he acknowledged the need for the right structure and resources to successfully execute these plans.
As part of the reorganization, Etsy’s chief marketing officer and chief human resources officer will be leaving the company, with other executives taking on expanded roles. Despite the difficult decisions, Silverman expressed confidence in the company’s future prospects.
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