Bad news on the horizon?
A memo from Disney CEO Bob Chapek published earlier in the week stated layoffs and a hiring freeze are coming soon within the Walt Disney Company. It is not clear if Walt Disney World will be affected by the cutbacks.
One union leader, Unite Here Local 362 President Eric Clinton, said Monday that he has not heard anything from Disney World about the hiring freeze or layoffs and at this point, does not think they will happen at the Orlando theme park.
Chapek’s memo, sent internally to Disney division executives Friday, said the company is looking to reduce its workforce through a companywide cost-cutting initiative. His note did not say where these layoffs are expected to take place.
“We will look at every avenue of operations and labor to find savings, and we do anticipate some staff reductions as part of this review,” he wrote, according to a copy of the memo.
He also announced a “targeted hiring freeze” for all roles but “the most critical, business-driving positions” and said executives would be individually notified of the impacts to their teams.
“I am fully aware this will be a difficult process for many of you and your teams,” he wrote to Disney leaders. “We are going to have to make tough and uncomfortable decisions. But that is just what leadership requires, and I thank you in advance for stepping up during this important time.”
Disney employs about 190,000 people across the company’s entertainment and theme parks divisions, according to its most recent financial filings. About 70,000 of those employees work at Walt Disney World in Orlando, one of the largest single-site employers in the country.
Chapek’s memo comes after Disney’s fourth quarter and year-end earnings call, which reported annual revenue of $28.7 billion in the company’s theme parks division, but significant losses in streaming services. During the Nov. 8 call, CFO Christine McCarthy said the company was “actively evaluating [its] cost base” and “looking for meaningful efficiencies.”
Disney stock plunged to $86.75 after the call. That was just 99 cents above the stock price on March 23, 2020, days after the company announced it was shutting down its theme parks due to the COVID-19 pandemic.
News of staffing reductions and the hiring freeze comes as Disney, like other theme park companies, has faced staffing issues in recent months.
In May, Chapek said the company has not had “too big an issue” attracting or retaining theme park employees, but McCarthy said Disney was dealing with “rising wages” and a “tighter labor market.”
Concerned that layoffs and hiring freezes may impact Walt Disney World?