Disney to lay off 28,000 staffs due to coronavirus

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Disney is expected to lay off 28,000 of its employees across its parks, experiences and consumer products divisions, citing difficulties operating the company’s theme parks with prolonged coronavirus-related closures and limited openings.

The company’s head of parks Josh D’Amaro wrote a letter to Disney’s employees on Tuesday to announce “difficult decisions” to reduce the size of its staff across executive, salaried and hourly roles as it approaches the end of its fiscal quarter after billions of dollars in revenue downturns in 2020.

“We initially hoped that this situation would be short-lived, and that we would recover quickly and return to normal,” he wrote “Seven months later, we find that has not been the case.”

Management is expected to meet with affected salaried and non-union hourly employees this week.

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The media powerhouse has closed its parks in March at the onset of the pandemic, but it began reopening parks around the globe in limited capacities, including a controversial Disney World reopening in July despite Florida’s worrying surge in Covid-19 cases.

But its California Adventure and Disneyland parks in California have remained closed throughout the public health crisis.

California lawmakers have urged Governor Gavin Newsom to issue guidelines to begin reopening parks in the state, though the state’s Health and Human Services Secretary Mark Ghaly has not provided a timeline for doing so, stressing that the “work is underway” to issue guidance “in a responsible way as soon as possible.”

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“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, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic,” Mr D’Amaro wrote in his memo to employees.

The company’s parks, experiences and consumer products divisions accounted for nearly 40 per cent of the company’s $70bn revenue in 2019. 

Disney took a $1bn hit by the end of the second quarter in March following closures that month, while the persistence of the Covid-19 crisis ballooned that figure to $3.5bn by the end of the third quarter in June.