Disney has begun to permanently eliminate around 28,000 domestic jobs in its theme parks division due to uncertainty surrounding the coronavirus pandemic, two-thirds of which will be part-time roles.
The company blamed California for exacerbating its financial woes due to its “unwillingness” to lift COVID-19 restrictions that would allow Disneyland, which has remained closed since March, to reopen. Walt Disney World in Florida has been opened with limited capacity since July.
“In light of the prolonged impact of COVID-19 on our business, including limited capacity due to physical distancing requirements and the continued uncertainty regarding the duration of the pandemic – exacerbated in California by the State’s unwillingness to lift restrictions that would allow Disneyland to reopen – we have made the very difficult decision to begin the process of reducing our workforce at our Parks, Experiences and Products segment at all levels, having kept non-working Cast Members on furlough since April, while paying healthcare benefits,” Josh D’Amaro, chairman, Disney Parks, Experiences and Products, said in a statement. “Approximately 28,000 domestic employees will be affected, of which about 67% are part-time. We are talking with impacted employees as well as to the unions on next steps for union-represented Cast Members.”
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The parks, experiences and products division has been particularly hampered by the pandemic. During its most recent quarter, Disney said the Disney World reopening has not gone as well as hoped. The parks division lost out on $3.5 billion in operating income for its fiscal third quarter, which ended June 27. Overall, Disney’s parks business pulled in just $983 million during the quarter, which was an 85% slide compared with the $6.6 billion in revenue the parks earned during the same period last year. That’s coming off a second quarter in which the company took a $1 billion hit earlier this year.
Although parks in Shanghai, Hong Kong and Japan were able to reopen during the quarter, most of Disney’s parks business comes from its U.S. locations.
D’Amaro’s statement continued: “Over the past several months, we’ve been forced to make a number of necessary adjustments to our business, and as difficult as this decision is today, we believe that the steps we are taking will enable us to emerge a more effective and efficient operation when we return to normal. Our Cast Members have always been key to our success, playing a valued and important role in delivering a world-class experience, and we look forward to providing opportunities where we can for them to return.”
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