Impact of Paramount Global’s Layoffs: What Lies Ahead for the Web3 Community?

Paramount Global on Tuesday said that it will be laying off hundreds of employees for the firm to build “momentum”. According to a CNBC report, the company will be slashing at least 3% of the jobs at the firm. The news comes as a further disadvantage for Web3 and the crypto community who are already grappling with job cuts in the segment.

Media giant Paramount to lay off staff

CEO Bob Bakish of Paramount Global said in an internal message to staff members on Tuesday that the business is cutting off jobs for its workers. The workforce reduction comes at a time when the company is mounting good revenues. Just a day prior, the firm had announced record-breaking Super Bowl viewership on CBS.

According to the CNBC report, approximately 800 employees, or 3% of Paramount’s workforce, will be let go. By the end of 2022, Paramount Global employed over 24,500 people both full- and part-time. Paramount Global had just recently ventured into the Web3 and crypto space. The company had filed two crypto-related trademarks for Mean Girls. The company planned to expand the brand into “crypto-collectibles,” per the trademark registration.

Paramount’s layoffs in tandem with the broader market

Paramount’s job cut comes at a time when major market players have been slashing jobs. Since 2023, major players in technology, media, and finance have heavily hopped on the layoff bandwagon. Companies involved in Web3 and cryptocurrency have additionally also started reducing jobs. The decision by Polygon Labs to lay off roughly 19% of its employees serves as evidence of this. The company did, however, make it clear that performance improvements, not budgetary constraints, were the driving force behind the personnel reduction. Additionally, staff reductions were reported by Snap Inc., the firm behind the SNAP coin. By other large worldwide firms like Alphabet, Citi, Deutsche Bank, etc., Snap decided to lay off 10% of its workforce.

After a time of lower-than-average layoffs in 2021 and the first part of 2022 due to hiring sprees by some businesses and severe labor shortages by others, there has been a rise in layoffs during the past year.

Crypto markets brace for uncertainty

Crypto markets have always been sensitive to border investor sentiments.  According to S&P Global, both bull and bear markets for cryptocurrencies have occurred during times of extremely loose monetary policy and marked tightening. Although the sharp rise in interest rates may have a detrimental effect on cryptocurrency markets, idiosyncratic variables also appear to be important. Cryptocurrency markets seem to do better in times of low market volatility and worse in times of high volatility. Thus higher amount of layoffs would also mean dented investor sentiments and less purchasing power among investors. This could negatively affect crypto markets in the near term. However, a pick up in the job markets in the longer term will resurface positive tones in the crypto markets.