Affected by the zero-COVID policy, many Chinese companies have been facing no orders from outside and no domestic consumption. They have been forced to lay off employees.
One of the latest victims is Chinese big data solutions provider MiningLamp Technology, an artificial intelligence unicorn company in China.
According to TimedNews, MiningLamp Technology has recently disclosed that more than 70% of the company’s employees have been fired.
The workforce is now left with more than 1,000 people. At its peak, the company had between 5,000 and 6,000 employees.
MiningLamp Technology has once been the most valued big data company in China.
Founded in 2014, MiningLamp Technology secured 1.2 billion yuan ($166 million) in its first three rounds of funding. By 2018, it had a valuation of over $1 billion, making it a unicorn in the artificial intelligence sector.
According to Yicai Global, the company has partnered with many industry leaders such as Tencent on urban digitalization, marketing, and government affairs.
But under the zero-COVID policy, many other Chinese companies, including MiningLamp, could not receive foreign or domestic orders.
They must adopt austerity policies and downsize office space or lay off workers.
MiningLamp Technology has reported multiple layoffs for more than a year, firing employees across the board in many departments.
According to the company’s employees, the big data star has disbanded its R&D department and laid off workers in the digital city and financial departments.
The company is still struggling to manage legal severance payments for laid-off employees.
According to financial experts, large-scale layoffs in MiningLamp Technology are very rare in the unicorn company. As a high-tech field on which the Chinese government depends, the company’s development prospects are supposed to be promising. However, the layoffs show that even a unicorn company is beginning to lose its edge.
MiningLamp Technology is a representative of the AI industry, and its layoffs are not at all a problem for one company. It can be seen that China’s entire AI big data industry is in crisis.
And this is an indicator of a full-blown recession and the loss of vitality of an economy.