Andela, the engineering-as-a-service company, is one of the many businesses resorting to salary cuts and layoffs due to the coronavirus-induced recession. The company has laid off 135 of its staff across five countries, excluding Rwanda and Ghana. Andela expects to save about $5 million from the layoffs.
The company’s CEO, Jeremy Johnson, announced this in a company-wide video conference call attended by over 1,300 staff from Nigeria, Uganda, Kenya, Rwanda, Ghana, Egypt, and the United States. After the emergency meeting, an email was sent to all staff, where Johnson stated that shrinkage in the company’s customer base was the major reason for the lay offs.
According to Johnson, “while our customer base has held up better than most, the majority have still been impacted by the economic downturn. Andela expects to see churn spike this year as well as a decline in new customers due to the economic uncertainty. Expectations for slow growth necessitate cost cutting measures to ensure that we make it to the other side.”
This is the third round of sacks in the company in the last 9 months. In September 2019, 420 staff comprising mainly of junior developers who joined the company through its fellowship program were dismissed. An unspecified number were also let go between January and February 2020.
In addition, Andela’s directors and above are taking salary cuts ranging from 10% to 30% depending on seniority. To save about $25 million, the company will also cut down on operational costs from travel, compensations, software and others.