Unconfirmed news indicates that PayPal will announce that they are cutting their workforce by 3%.
Because the plans have not been formally announced, the anonymous individual has indicated that this 3% reduction in the workforce is anticipated to range anywhere from 300 to 400 employees being laid off. The area of the workforce downsizing will be in the area of development, marketing and technology.
PayPal is a part of eBay Inc and is the division of eBay that focuses on payments.
In total, PayPal has almost 13,000 employees.
The current president of PayPal is David Marcus. Mr. Marcus became the president of PayPal during the early part of this year. This administrative role took place when eBay acquired Zong. Zong was a mobile payment start up that David Marcus headed when eBay made this acquisition.
Marcus’s goal has been to shift the focus of PayPal. This strategy is to provide more attention to the consumer. Additionally, attention has been given to the development process regarding the product that is offered. Specifically, it was determined that this process was bogged down and therefore the shift to expedite the process is being implemented.
The current process was bemoaned by a number of store merchants who complained about the sluggishness of account setups. In addition, reports emanating from within PayPal have indicated that internal processes involved a number of counterproductive meetings and an approval process that could take months for implementation.
Officially, a PayPal spokesperson stated in an e-mail that PayPal leadership has announced to staff that plans will be implemented to make things easier and undergird the process regarding the creation and delivery of the quality products and in keeping with the brand that customers expect. However, in releasing this statement no comment was made on how and if this strategy would affect current employment positions at PayPal.
In an effort to be more productive and financially viable, PayPal has expended considerable amounts of money. This money has been invested in new products and transactions to acquire other companies.
Adding to the challenge of keeping PayPal financially productive are new payment products that are being introduced that facilitate payments between vendors and customers. Products such as Mobile Wallet and Square are being introduced and it is anticipated that they will or have already impacted the market held my PayPal.
In regards to revenues for 2012, PayPal accounts for 40% of eBay revenues. The $1.36 billion in quarterly revenues is a 26% yearly increase over last year’s income.
If the anonymous announcement becomes a reality, it will be PayPal’s only significant employment reduction since 2008 when the recent financial crisis evolved.