Global ratings agency Moody’s Corporation will be closing its consulting business in China and laying off staff across multiple locations across the country, according to a Reuters report.
The US-headquartered company started wrapping up its business Moody’s Analytics in China this week. Consequently, the layoffs will affect over 100 employees in Beijing, Shanghai, and Shenzhen offices. The number amounts to over 25% of the company’s workforce in the Greater China area, which comprises offices in Hong Kong and Taipei.
In a recent earnings call, the company said it was taking measures to align its global workforce with the current and anticipated economic conditions.
“Moody’s continues to maintain a strong presence in China and contribute constructively to China’s sustainable growth and the further development of its domestic markets,” it added.
Moody’s Analytics management team alerted employees of mass layoffs on Wednesday morning in a Zoom call titled “business update”, reported Financial Times.
The management explained that the measures were being taken for “cost reduction and efficiency enhancement”, and said were in line with a group strategy to significantly reducing the company’s physical footprint globally and streamline operations in mainland China.
Multinationals are pivoting away from mainland China in the backdrop of the country’s sporadic lockdowns and unrelenting Covid-19 policy.
EU Chamber of Commerce in a recent report said China has become less predictable, less reliable and less efficient, prompting several large multinational companies to shift operations to other countries. According to the report, 50% of western companies are of the view that business in China has become more politicised than ever in the last few years.
In October, Google said it was shutting down Google Translate service in the country due to low usage.
Other countries to pull the plug on China operations include Amazon, LinkedIn, Yahoo, and Microsoft.
