Disney to Axe 28,000 Jobs

Disney Theme Park agreed on Tuesday to lay off 28,000 employees in the United States as the coronavirus pandemic hits its parks and resorts business.

Approximately 67% of employees who lose their jobs are part-time staff, Disney said, CNN reports.

Disney has been affected by the coronavirus pandemic in many ways, but its theme parks and resort company have undoubtedly been the biggest hit of all. The Disney Parks Unit, which contributed to more than $26 billion in fiscal 2019, was crushed in the second quarter of this year.

Operating profit in the division dropped by 58% compared to the previous year, and Disney announced a loss of $1 billion in profit just a few weeks after the global health crisis.

Disney Parks Chairman Josh D'Amaro defended the staffing cuts as “necessary” citing the "prolonged impact" of coronavirus on business. That included "limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic."

In a statement, D'Amaro said that Disney's employees have always "been the key to our success, playing a valued and important role in delivering a world-class experience".

"We look forward to providing opportunities where we can for them to return," he said.

The Disney theme parks were closed globally during the Covid-19 pandemic, hindering its business.

According to the reports, 67% of the employees laid off will be part-time staff and the cuts will also impact the Disney Parks, Experiences and Merchandise Unit and more than 100,000 US employees work in the Disney Parks and Resorts division.

Due to the pandemic, the company’s profit dropped 91 per cent during the first three months of 2020.

D'Amaro also blamed the state of California for its "unwillingness to lift restrictions” that would allow Disneyland to reopen. "Disneyland and California Adventure, the company's flagship resorts in California, have been closed since March.

Disney World, Florida's resort, also closed its doors in March, but began operating for its parks in July.

The resort has reopened safety procedures and health programs, including decreased capacity at its parks and requiring all staff and visitors to wear masks.

Disney notified its employees in April that because of coronavirus it would furlough employees "whose jobs aren't necessary at this time" starting on April 19.

"As you can imagine, a decision of this magnitude is not easy," D'Amaro wrote in a memo to employees that was obtained by CNN Business. "We've cut expenses, suspended capital projects, furloughed our cast members while still paying benefits, and modified our operations to run as efficiently as possible, however, we simply cannot responsibly stay fully staffed while operating at such limited capacity."