The economic pressures of 2024 have sparked a wave of layoffs across Asia’s biggest industries. Companies in sectors ranging from tech and e-commerce to fashion and sports are grappling with challenging market conditions, pushing them to recalibrate their workforce strategies. Whether it’s tech giants like Grab and ByteDance, or e-commerce leaders like Lazada, the current climate demands a focus on profitability, operational efficiency, and long-term sustainability. What once seemed like endless expansion has become strategic realignment, with layoffs becoming an unfortunate yet essential step in this transformation.
These layoffs, announced in recent years, reflect the broader struggles facing businesses in Asia. Companies are not only under pressure to stay profitable but are also adapting to new technologies such as artificial intelligence (AI), navigating rising costs, and managing changing consumer demands. While these layoffs are positioned as strategic, they raise more profound questions about the future of work, the fairness of retrenchment processes, and how businesses can maintain growth while treating employees equitably. Let’s take a closer look at how these developments are playing out across key industries.
Tech sector cuts: Pivoting from growth to profitability
Tech companies, long celebrated for rapid expansion and innovation, have been forced to reassess their strategies in the face of financial pressures. One of the most significant examples comes from Grab, Southeast Asia’s leading ride-hailing and super-app provider, which laid off over 1,000 employees—11% of its workforce—last year. CEO Anthony Tan explained that the decision wasn’t about cutting costs for the sake of profitability but a necessary step to reorganise for long-term competitiveness. Tan pointed out that rapid changes in technology, like generative AI, coupled with the rising cost of capital, were reshaping the landscape in which Grab operates.
While the layoffs are painful, Grab has improved its financial position. The company reported a 77% improvement in its adjusted EBITDA for Q1 2023, reducing its losses from US$287 million to US$66 million. Still, the company is under intense pressure to achieve profitability soon. The layoffs were framed as part of a broader reorganisation to ensure Grab can work smarter, move faster, and rebalance its portfolio in line with long-term strategies. For Grab, the challenge remains balancing the need for profitability with its ongoing ambitions to remain a regional tech leader.
ByteDance, the parent company of TikTok, also reflects this trend of pivoting towards operational efficiency through layoffs. ByteDance cut hundreds of content moderation roles just days ago, particularly in Malaysia, where over 700 employees were let go. The company is now relying more heavily on AI to moderate its content, a shift that aligns with broader efforts to automate processes and cut costs. While ByteDance’s focus on AI reflects its innovative approach, the decision has also sparked concerns about the future of human roles in tech as automation increasingly replaces manual tasks.
Sports industry cuts: Restructuring for long-term sustainability
The sports entertainment industry, typically synonymous with growth and global expansion, has not been immune to financial pressures. ONE Championship, Asia’s leading mixed martial arts organisation, recently announced it would lay off “a few dozen” employees as part of a strategic plan to improve profitability. The Singapore-based company, valued at US$1.35 billion following a US$50 million investment from the Qatar Investment Authority, is under pressure to streamline operations. ONE Championship’s leadership has made it clear that this decision reflects their commitment to long-term sustainability, rather than just immediate cost-cutting.
ONE Championship has had to retrench staff before. In 2020, amid the COVID-19 pandemic, the company cut 20% of its global workforce. These recent layoffs underscore the sports industry’s challenges in balancing rapid growth with profitability. While the company’s long-term vision includes continued expansion across Asia and beyond, financial constraints require a more measured approach. Like other sectors, the sports industry is undergoing a recalibration, where sustainability takes precedence over over-aggressive expansion.
ONE Championship’s retrenchment also reflects the broader trend seen in other industries. The timing coincided with similar rounds of layoffs at companies like Dyson and Samsung, which have also announced workforce cuts in Singapore to adapt to the global economic environment. This wave of layoffs within such diverse sectors highlights how the need to refocus on operational efficiency has become a unifying theme across industries.
E-commerce realignment: From expansion to streamlining
The e-commerce industry, which saw explosive growth during the pandemic, is now focusing on streamlining operations to ensure long-term sustainability. Lazada, one of Southeast Asia’s largest e-commerce platforms, has been under fire for its retrenchment process, which began in January 2024.
Lazada’s layoffs highlight the broader trend in the e-commerce sector, where companies are transitioning from aggressive market expansion to cost-saving measures. Following the initial retrenchment, Lazada and the Food, Drinks and Allied Workers Union (FDAWU) reached a settlement, ensuring enhanced support packages for unionised employees. However, handling the layoffs has raised questions about transparency and communication, with many former employees feeling that the process was opaque and unfair. This controversy has put a spotlight on the growing need for clear, equitable layoff procedures within the industry.
The broader challenge for e-commerce platforms like Lazada is maintaining customer demand while balancing operational costs. With competition from regional rivals and rising investor expectations, companies are under pressure to show profitability. As Lazada shifts its focus towards efficiency, the question remains whether these cost-cutting measures will ultimately help the company stay competitive or risk losing its standing in an increasingly saturated market. Lazada’s approach to retrenchment, including handling employee relations, will serve as a key indicator of how the company plans to navigate the complexities of post-pandemic e-commerce.
Fashion and retail: Reining in growth amidst global ambitions
Fashion companies, which once thrived on the promise of global expansion, are also scaling back to manage financial pressures. Love, Bonito, a Singapore-based fashion brand, laid off 6.9% of its global workforce yesterday, with 14 jobs cut in Singapore. Despite raising US$50 million in funding in 2021 to expand into markets like the United States, the company is now prioritising operational efficiency.
The fashion industry is experiencing pressures similar to those of other sectors, where the expansion cost has become increasingly difficult to sustain. Love, Bonito’s cuts reflect a broader shift in the industry from aggressive expansion to cautious realignment. While the brand has successfully established itself in Southeast Asia, with 26 stores across multiple countries, it now faces the challenge of balancing international ambitions with the realities of the global retail market. As consumer behaviour shifts and online shopping continues to evolve, fashion retailers must adapt their business models to remain profitable.
For Love, Bonito, the road ahead will involve strategically deciding where to focus resources. The company’s decision to lay off staff suggests a recalibration of its expansion plans and a desire to consolidate its position within key markets. However, the layoffs also raise questions about whether the brand can continue to grow globally or will need to rein in its ambitions in favour of a more sustainable approach. For now, Love, Bonito’s future depends on how well it can navigate this balance between expansion and operational efficiency.
Business flexibility vs. worker rights: The struggle for balance
The handling of layoffs has brought the debate over business flexibility and worker rights to the forefront, particularly in Singapore. The British consumer electronics giant Dyson faced criticism after announcing layoffs in Singapore. The company gave just a day’s notice to the United Workers of Electronics & Electrical Industries (UWEEI), sparking backlash over its lack of transparency. While Dyson complied with local laws, the case raised concerns about how businesses manage retrenchments in a country known for its pro-business environment.
Senior Minister of State for Manpower Zaqy Mohamad addressed the issue in parliament, emphasising the need for trust between employers and unions during retrenchment exercises. Singapore’s reputation as an attractive destination for investment depends on its ability to strike a balance between safeguarding workers’ rights and allowing businesses the flexibility they need to respond to changing market conditions. Dyson’s case serves as a reminder that while businesses must remain competitive, they must also handle layoffs with care to avoid damaging their reputations.
This tension between business flexibility and worker rights is also evident in Lazada’s layoffs, where dissatisfaction arose from the perceived lack of fairness in the retrenchment process. Former employees expressed frustration with the unequal payout packages and the lack of transparency during negotiations. For companies like Lazada and Dyson, managing layoffs is about adhering to legal requirements, maintaining a strong employer brand, and fostering trust with employees. How businesses handle retrenchment will be crucial in shaping their reputations and relationships with their workforce going forward.
The bigger question: Can businesses maintain profitability without sacrificing employee welfare?
A crucial question emerging from these layoffs is how companies can strike a balance between the need for profitability and operational efficiency, and their responsibility toward employee welfare. As firms like Grab, Lazada, and ONE Championship focus on streamlining operations to stay competitive, they face the challenge of making tough decisions without undermining the trust of their workforce. The wave of retrenchments raises concerns about whether businesses can continue to grow and adapt without leaving employees behind, especially in industries heavily reliant on human capital.
The broader issue is whether companies can manage these economic pressures in a way that ensures both financial sustainability and fair treatment of employees. As businesses recalibrate their strategies, the question of how much workforce restructuring is necessary—and how it is handled—becomes central to the future of corporate leadership in Asia. Transparent communication, equitable severance packages, and support for displaced workers will be key factors in determining how companies are perceived by both their employees and the broader public.
The challenge is clear: Can companies continue to innovate and improve profitability without eroding employee morale and trust? The answer to this question will define the way forward for industries across Asia as they navigate an increasingly uncertain economic environment.
Layoffs reflect deeper shifts in market strategies
The mass layoffs seen across companies like Grab, Lazada, Love, Bonito, Dyson, and ByteDance reflect a broader shift in business strategies across Asia. Companies are moving away from aggressive growth models, focusing more on streamlining operations and achieving profitability. Whether through consolidating resources, as seen with Grab and Love, Bonito, or restructuring for long-term sustainability, as with ONE Championship, the overarching goal is to ensure survival in an increasingly competitive landscape.
These layoffs, however, raise critical questions about the future of work, especially as businesses make difficult decisions that affect their workforce. The dissatisfaction seen among Lazada employees and the backlash against Dyson’s approach to retrenchment demonstrate that while layoffs may be necessary, how they are handled can significantly impact a company’s reputation and employee relations. Companies that fail to offer fair severance packages, transparent communication, and meaningful support for displaced workers may find themselves facing long-term damage to their brand and workforce loyalty.
As businesses continue to recalibrate their strategies, they must navigate the delicate balance between profitability and fairness. The next few years will be crucial as companies across Asia adjust to the post-pandemic world. Whether these layoffs ultimately contribute to long-term success or create further challenges will depend on how businesses adapt their models, maintain ethical practices, and manage their most valuable resource: their people.
