Walt Disney announced it was laying off 28,000 employees from its theme park business on Tuesday, the latest company to announce huge jobs cuts in the wake of the coronavirus pandemic.
The entertainment company blamed limited attendance at the theme parks it has reopened and the continuing closure of others for the “difficult decision”.
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“As you can imagine, a decision of this magnitude is not easy,” Josh D’Amaro, head of parks at Disney, wrote in the letter obtained by CNBC.
“For the last several months, our management team has worked tirelessly to avoid having to separate anyone from the company. We’ve cut expenses, suspended capital projects, furloughed our cast members while still paying benefits, and modified our operations to run as efficiently as possible, however, we simply cannot responsibly stay fully staffed while operating at such limited capacity.”
Disney’s theme parks in Florida, Paris, Shanghai, Japan and Hong Kong have been reopened with limited capacity but both its parks in California remain closed as Orange county, home to Disneyland, struggles to meet local health metrics for reopening.
The majority of the positions Disney is cutting are part-time. “As heartbreaking as it is to take this action, this is the only feasible option we have in light of the prolonged impact of Covid-19 on our business,” wrote D’Amaro.
Disney lost $4.72bn in the three months ended on 27 June, its first quarterly loss in nearly two decades. The reopening of Walt Disney World in Orlando, Florida, has also proved disappointing as Covid-19 cases surge in the state.
The news follows announcements of other large layoffs from US corporations hit by the pandemic. United Airlines and American Airlines plan to cut thousands of jobs in the coming months as passengers avoid flying. Last week Ralph Lauren announced it was planning to cut 15% of its 24,900 global workforce.
On Friday the US labor department will release its latest monthly jobs report. The US is expected to have gained about 850,000 jobs in September, the fifth straight monthly gain. But the rate of recovery appears to be slowing and only about half the jobs lost during the pandemic have been recovered.
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