6 months’ salary, free MacBooks, and career support: Why Canva’s layoffs stand out

Canva, the popular design software company, is undergoing a workforce reduction of about 22 percent, affecting 1,271 employees. This comes amid slowing growth and a wave of layoffs in the tech industry. In a memo to employees, co-founder and CEO Melanie Perkins acknowledged the company's success but stated that they needed to change to address the slowdown. Perkins highlighted the talent and dedication of every employee, emphasizing that success in the first chapter does not guarantee future success.

The company is streamlining its organizational structure by merging product, growth, and platform teams, potentially requiring employees to take on additional responsibilities beyond their core duties. Canva, known for its flexible remote work model, is now asking employees to work from an office a few days a week. The company has also been developing its own AI models to offset costs and reliance on external AI providers, but rising AI expenses have forced them to lower their revenue growth forecast from 30 percent to 20 percent.

Reacting to the layoffs, many on social media praised Canva's approach for offering support to departing employees. For those leaving, the company is allowing them to keep their company-issued MacBooks, providing six months of salary as severance, including statutory entitlements. Additionally, they will receive a one-year LinkedIn Premium subscription, one-on-one career coaching, resume assistance, and interview preparation.

Canva is also creating an opt-in alumni directory to help former employees connect with potential employers and industry contacts. Moreover, employees will retain up to 12 months of continued healthcare coverage, and those who joined within the past year will not face a one-year vesting cliff on their employee stock arrangements.

The company is also offering US$10,000 grants to departing employees interested in starting their own businesses or community projects.