2023’s freight volumes were down considerably, prompting a massive surge in layoffs throughout the logistics sector, a trend encapsulated by the phrase ‘layoffs hit logistics.’ This wave of job reductions has affected companies, including Ryder Integrated Logistics and Universal Logistics, highlighting the widespread impact across the US. And it seems any hope that 2024 would be the light at the end of the tunnel has proven futile, as huge names slash jobs to put more money in the bank.
Many companies are contributing to this year’s layoffs, impacting supply chains and prompting a reevaluation of logistics strategies. Still, Flexport, UPS, Uber Freight, Flexe, and GXO Logistics are having the most significant impact, prompting Larry Aschebrook, a managing partner at G Squared, to tell The Wall Street Journal that, “You need to basically hunker down and survive.”
UPS
As the new year rang in, United Parcel Service Inc. (UPS) fell short of Wall Street’s revenue estimates ($24.92 billion rather than the expected $25.43 billion), citing decreases in domestic and international shipping volumes in its final quarterly earnings report 2023.
But that wasn’t the only news the company had up its sleeve — it also announced a whopping 12,000 layoffs across its facilities. This solution arose as part of its efforts to align resources throughout 2024, with company officials stating the reductions will save UPS roughly $1 billion in costs.
Employees who do not face the layoffs will be subject to Tomé’s plans to request workers return to the office five days a week later this year.
Uber Freight
Uber Freight slashed roughly 150 jobs in its digital brokerage department at the beginning of 2023, followed by around 50 employees in July. Yet, it appears their layoff spate isn’t over yet—in January 2024, the logistics leader confirmed it was forced to further reduce its workforce to align with its mission of driving sustainable growth.
A source told FreightWaves that between 40 and 50 jobs were cut. Still, the Chicago-based company declined to disclose the number of employees or percentage of the impacted workforce or details about severance packages. Instead, a spokesperson highlighted that the decision “wasn’t made lightly” and was conducted to “enhance operational efficiency and long-term success.”
Flexport
Despite already laying off a fifth of its workforce, Flexport, the supply chain logistics platform, announced its plan to reduce its employee pool by another 15% to decrease costs and reinstate profitability.
The discharges mainly impacted R&D positions in North America, with no to minimal effect on customer-facing workers. According to LinkedIn posts published by former employees, the affected professionals were operations associates and software engineers.
This was the company’s third huge layoff round over the past 12 months.
GXO Logistics
GXO Logistics filed a WARN notice with the state of Tennessee on January 9, 2024. It impacted 211 staff members at its logistics facility located at 4795 Imagination Drive. Most layoffs occurred in March; however, the notice mentions they’ll continue until April 27.
A company spokesperson wrote that GXO Logistics is finalizing operations with one client in the Memphis area. Therefore, the affected employees can apply for vacancies in nearby GXO sites that serve other customers.
Flexe
After eliminating 130 jobs in the fall of 2023, the Seattle-based supply chain startup and logistics provider Flexe cut another 99 employees at the beginning of 2024.
Despite being valued at $1 billion a few years ago, high-interest rates have dampened investors’ willingness to give more cash to startups, especially those in the supply chain and logistics sector, prompting Flexe to slice its workforce.
There’s More Where That Came From
Layoffs certainly aren’t exclusive to these companies above. Everybody is getting a piece of this less-than-pleasant pie — from employees from Swissport Cargo Services slashing 235 jobs after losing their Amazon contract, impacting their cargo handling operation at Newark Liberty International Airport, to Universal Logistics, an intermodal and logistics provider, permanently closing two subsidiaries, including Logistics Insights Corp., and laying off 677 employees to RXO Logistics, cutting 114 employees from their Warren-based facility following a contract loss.
But is the Layoffs Season Coming to a Close?
Increased workforce layoffs, job cuts, and facility closures mark the industry’s ongoing challenges, exacerbated by contractual shifts, corporate strategies, operational benchmarks, and the extended freight slump. The scope of layoffs, including job reductions and facility closures, reflects the significant impact on companies throughout the logistics sector, with numerous job cuts and reductions affecting a wide range of positions from truck drivers to clerical staff.
Even though some experts believe this decidedly grey-shrouded matter, highlighted by job cuts and job reductions, will continue as the calendar months tick by, many analysts predict better times in the year’s second half. There is much speculation about 2H 2024 and whether we’ve hit rock bottom as we roll into the second quarter, especially considering the reductions and facility closures that have been announced.
Only time will tell if layoffs, including job cuts and job reductions, will hit logistics harder in the future than they have in 2024. One thing is sure: the freight and logistics industry will remain on edge until the pattern of job cuts, job reductions, and facility closures changes.
