Disney to layoff 28,000 employees as coronavirus continues to decimate its theme parks

Disney is set to lay off around 28,000 employees in the United States as prolonged closures and limited attendance have decimated its theme park business. 

The announcement was made in a letter to employees Tuesday from Josh D’Amaro, Disney’s head of parks, who detailed several ‘difficult decisions’ the company has been forced to make amid the ongoing pandemic. 

One such decision includes ending the furlough of thousands of employees in its parks, experiences and products segment.

Around 67 seven percent of the 28,000 layoffs were part-time workers, but they ranged from salaried employees to nonunion hourly workers, Disney officials said. 

In total, the number of axed employees accounts for around 25 percent of Disney’s domestic resort workforce.  

Disney is set to lay off around 28,000 employees across its US theme parks, experiences and consumer products segment as prolonged closures and limited attendance have decimated profits (It’s Florida resort is shown above on re-opening day on July 14)

While the company has been able to operate its parks in Florida, Paris, Shanghai, Japan and Hong Kong at a limited capacity, California Adventure and Disneyland have remained shuttered in Anaheim since the spring. 

Prior to the pandemic, Disney’s California and Florida parks employed roughly 110,000 people. The announced cuts, which will come from both resorts, will now reduce that number to around 82,000. 

Disney officials didn’t offer a breakdown of the layoffs between the two operations. 

‘As you can imagine, a decision of this magnitude is not easy,’ D’Amaro wrote in his letter. ‘For the last several months, our management team has worked tirelessly to avoid having to separate anyone from the company.’

D’Amaro continued that the company has cut expenses, suspended projects and modified operations but it wasn’t enough given limits on the number of people allowed into the park because of social distancing restrictions and other pandemic-related measures.

‘We simply cannot responsibly stay fully staffed while operating at such limited capacity,’ he added. ‘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’.

Disney officials said the company would provide severance packages for the employees, where appropriate, and also offer other services to help workers with job placement. 

While the company has been able to operate its parks in Florida, Paris, Shanghai, Japan and Hong Kong at a limited capacity, California Adventure and Disneyland have remained shuttered in Anaheim since the spring (Anaheim resort showed in March, just days before its closure)

While its Florida park opened with a limited capacity in mid-July, footfall has fallen far short of Disney’s expectations, with concerns about coronavirus safety reportedly a major factor

In a statement to the New York Times, D’Amaro said the layoffs were ‘exacerbated in California by the state’s unwillingness to lift restrictions that would allow Disneyland to reopen.’

While its Florida park opened with a limited capacity in mid-July, footfall has fallen far short of Disney’s expectations, with concerns about coronavirus safety reportedly a major factor.  

Disney furloughed up to 43,000 workers while still paying for their health insurance at its Florida resort. Around 20,000 were brought back after it reopened in July. 

Furloughed workers in California also received health benefits over the last six months. Disney had been hoping to find the light in the end of the pandemic tunnel, though so far no rest-bite has appeared – prompting Tuesday’s announcement.

The parks, experiences and consumer products segment is paramount to Disney’s business model.

Last year alone, the sector account for roughly 37 percent of the company’s total revenue of $69.9 billion.  

This is a developing story. Please check back for updates…