BUFFALO, N.Y. (WIVB) – Geico is cutting its total workforce by 6%, laying off roughly 2,000 of its employees as of Thursday, according to a letter from the auto insurance company’s CEO.
“This very difficult decision was not taken lightly. We recognize we’re saying goodbye to beloved colleagues and friends, and as a leadership team we are committed to supporting those affected in the days ahead,” CEO Todd Combs wrote in the letter, which was obtained by Nexstar’s WIVB.
Combs said he hopes to “better position [Geico] for long-term profitability and growth.”
Those affected by the sudden decision to let employees go will be contacted Thursday, according to the letter.
The letter did not provide specific reasons for Thursday’s layoffs, but Combs did say inflation, prolonged turnaround for repairs (due to staffing or supply shortages) and “rising medical costs” had recently posed challenges for the company.
“Despite these historic challenges, we have made great progress in returning
GEICO to profitability and establishing a foundation for growth while increasing
our agility and strength in the long term,” Combs wrote.
The company, however, still needs to “adapt” and “stay competitive,” he later wrote.
Combs pledged to offer career transition assistance to workers that were let go. Employees affected by the layoffs will also be able to apply for other open positions within the company, he said.
In addition to news of the layoffs, the letter also informed remote and hybrid employees that Geico will be requiring workers to increase their number of “in-office days.”
“We understand that additional time in the office is a shift from what has been the practice across most companies and industries these past few years,” said Combs, who added that the new policy will be fully implemented come January.