Lyft freezes hiring in the U.S. amid economic slowdown

Yahoo Finance Live anchors discuss ride share giant Lyft freezing its hiring in the U.S. amid economic uncertainty.

Video Transcript

JULIE HYMAN: Let's talk about shares of Lyft also this morning, and that's after the ride hailing company announced it's freezing all US hiring amid the stock's recent slump and economic downturn. It comes as Lyft has done some other cost cutting measures recently, including offering its office space for subleasing, an end to direct car rental as well. The shares are just down a little bit about 1%.

Certainly, Lyft is far from the only company. In fact, DocuSign also made some announcements of job cuts this morning of 9% of its workforce. So it just shows sort of the retrenching of corporate America as it braces for what could be coming.

BRIAN SOZZI: Yeah, I think this has been nicely telegraphed by Lyft. We've talked to co-founder John Zimmer numerous times. It really started, I would say, a year ago when the company just hit the reset button on its expenses. That's why it's bottom line, despite some of this economic uncertainty, has been somewhat decent to kick off the year.

But again, I'm not surprised here. I would be now wondering if you are an investor in this space, what have the trends been in monthly rides. What did they look like for the balance of September as the stock market has been under a lot of pressure? And of course, if Lyft is cutting expenses, what in the world is Uber doing?

BRAD SMITH: Yeah, that's a great question. I mean, for Lyft and Uber, they've had to monitor any of their hiring that they were set to do. This is an update from what Lyft had put out there in May of 2022, saying back then that they were going to slow hiring and actually reduce the budgets of some of its departments, plus grant new stock options to employees to really kind of make up for the declines that they had seen in the share value.

And so all of that in mind, this is an update to say essentially that, yeah, now we're taking the same route as some of the other companies that have frozen hiring. We've seen that across the software ERP space as well. So within broader tech, there's this more of an effort to freeze hiring right now when you're uncertain about even in a tight labor market, unsure about exactly where you're going to be able to pay those employees longer term, too.

BRIAN SOZZI: And then you have Goldman Sachs, too. With their performance reviews back, you've seen some cuts start to happen at the big banks. I suspect more will be coming.

JULIE HYMAN: Yeah, it seems to be happening in a lot of different industries at this point, but especially acute in tech for sure.