Amid China’s economic downturn, a wave of layoffs continues to spread. Recent reports suggest that Xiaohongshu, achieving up to 30%.
It is said that Xiaohongshu is currently undergoing a round of organizational restructuring and layoffs, focusing mainly on employees with performance ratings below 3.5, which account for about 30% of the total workforce.
According to reports from Phoenix Technology, employees of Xiaohongshu revealed that the layoffs are currently in the phase of locking in headcount (HC) quotas. The company is conducting an internal personnel inventory, but official notifications have not yet been issued, and employees are awaiting relevant emails.
The reason for this round of layoffs is dissatisfaction from Xiaohongshu’s new senior management with the personnel efficiency ratio. According to internal sources, the new management believes that Xiaohongshu’s current personnel efficiency ratio is only half that of Pinduoduo, hence the decision to optimize human resources costs through layoffs.
Recruitment industry sources disclosed that Xiaohongshu had strict age requirements during recruitment, originally setting the upper age limit at 35. However, even job seekers aged 32 may now find it difficult to secure employment opportunities.
As of now, Xiaohongshu has not made an official response to the layoff plan and related rumors.
Reports from Sina Technology on July 8th stated that behind the frequent personnel adjustments is the decline in Xiaohongshu’s valuation, highlighting commercial difficulties. Data shows that Xiaohongshu has completed six rounds of financing, with the last round at the end of 2021 valuing the company at a post-investment $20 billion (approximately 145.4 billion RMB). However, in the “2024 Global Unicorn Index” released by Hurun, the company’s valuation has dropped to 100 billion RMB.
Aside from the reported organizational adjustments, 21st Century Business Herald previously reported that Xiaohongshu’s self-operated e-commerce platforms “Welfare Society” and “Little Oasis” announced closures last year.
In September 2023, Xiaohongshu’s “Welfare Society” released a farewell letter to users titled “It’s a farewell, but also a new beginning,” indicating the complete closure of Xiaohongshu’s self-operated e-commerce platform. Welfare Society was Xiaohongshu’s self-operated store established at the end of 2014.
Furthermore, Xiaohongshu’s e-commerce platform “Little Oasis” also issued a farewell letter to users, stating that due to business adjustments, it officially closed on October 31, 2023.