October 3rd, 2020, 4:28 pm
New Work SE has confirmed that the effects of the corona crisis will lead to savings in the company. New Work wants to save 16 million euros in the coming year. There will also be job cuts because the desired volume cannot be achieved with material cost reductions alone, according to New Work.
Material cost reductions are not enough
It is currently unclear which and how many jobs are to be cut. At Honeypot, the job platform for IT specialists that was only acquired in 2019 for 22 million euros, 30 layoffs have been confirmed so far. New Work has also already confirmed upcoming layoffs for Kununu Engage, a startup subsidiary of the employer rating platform Kununu founded in 2017. Kununu Engage is a SaaS (Software-as-a-Service) tool for measuring employee satisfaction. Talks with the employee representatives in other New Work companies are currently ongoing.
The announcement of massive cost savings comes as a surprise for employees and the public. In August, company boss Petra von Strombeck announced a “stable business”. At this point in time, they expected around two percent growth compared to the previous year. A little more than a month later there is no longer any talk.
Although the core business is running stable, New Work SE told the time, the corona crisis is having an impact in the areas of advertising and events. This leads to significantly lower growth than in the previous year and requires cost-cutting measures. With Honeypot and Kununu Engage, New Work has already identified “individual activities” in which investments have been made in the past as significant savings potential.
This is New Work SE
New Work SE was created in spring 2019 by renaming the former Xing SE. In addition to Xing, Honeypot and Kununu Engage, New Work SE also includes the employer review portal kununu and InterNations, a social network for people who work abroad. In the first half of the year, New Work SE achieved sales of just over 136 million euros, an increase of six percent compared to the previous year. The company employed around 2,000 people at the end of the first half of 2020.
If we take a closer look at the annual report of New Work SE from the first half of 2020 ( PDF ), questions arise. We have already seen that sales increased by six percent compared to the previous year.
If we look at the corporate divisions, it becomes apparent that all segments show slight to significant improvements, with the exception of the “BSB Marketing Solutions & Events” division. Here sales fell by 26 percent to 8.9 million euros. Nanu?
Let’s do the math for a minute. So if sales fell at the rate mentioned, then it was around 12 million euros in the previous year, a little more than three million more. It is unclear where the requirement to have to save 16 million will come from, especially since the missing three million are more than compensated for by the total plus. The argument that this was due to the corona situation in any case misses the point in terms of numbers.