After a long struggle, LinkedIn gives up on China

After a long struggle, LinkedIn gives up on ChinaSource: Shutterstock

After a long struggle, LinkedIn gives up on China

  • LinkedIn said its pared-back job application site in China faced increased competition and a tight regulatory environment.
  • Jobs in China in product, engineering, corporate, sales, and marketing would go as part of the 716 jobs slash.

For almost a decade, LinkedIn has fought hard to survive in China, all while taking a social media beating in the West for its self-censorship. As years passed, the stakes increased for the jobs networking site. It started facing even more significant obstacles with many prominent domestic players.

Unfortunately, by 2021, LinkedIn shut down its flagship networking service in China. When the Microsoft-owned networking platform cited compliance issues and a “significantly more challenging operating environment,” it wasn’t surprising. At that point in time, LinkedIn had 53 million users in China, making up about 7% of its total user base. 

But it was a partial exit for LinkedIn. Instead, the networking platform decided to replace the Chinese version of its site with a new job-board service called “InCareer.” The idea is a pared-back job application site without any social media functions of the entire LinkedIn site. 

The stripped-back version, launched in December 2021, also restricts Chinese users from sharing posts or news articles. Alas, InCareer didn’t last, and in a layoff announcement this week, LinkedIn said they would be axing 716 jobs which would directly result in the closure of its Chinese version of LinkedIn.

As the latest tech company to announce layoffs, LinkedIn said it is mainly to rein back costs, with sales, operations, and support teams being impacted. The move, announced Monday, will affect around 3.5% of LinkedIn’s approximately 19,000 employees worldwide. LinkedIn chief executive Ryan Roslansky wrote in a letter to employees on May 8 that 716 job cuts globally would also include China’s product and engineering teams. 

“Though InCareer experienced some success in the past year thanks to our strong China-based team, it also encountered fierce competition and a challenging macroeconomic climate,” he said in the message. In other words, LinkedIn is once again paring down its operations in China, further exemplifying the challenges of running a foreign business in the country.

Just two months before this week’s update, LinkedIn was summoned by the country’s internet regulator in March and was ordered to clean up its online content. The same month, the company said it was “temporarily pausing new member sign-ups for LinkedIn China” as it tried to become compliant “with local law.”  

To date, InCareer still retained a limited messaging function, and its closure would mean foreign businesses and investors will have fewer tools to monitor their China operations. In a separate Chinese letter to clients published on the social media platform WeChat, LinkedIn said InCareer would shut down on August 9, 2023.

Since the launch of InCareer, the app has deteriorated far behind rival domestic platforms. According to market research firm Analysys, it had 959,600 monthly active users in March. In comparison, other Chinese online recruitment platforms, including 51job, had 18.5 million users that month, Boss Zhipin had 17.3 million, and Liepin had 6.7 million.

What’s next for LinkedIn in China?

Roslansky’s note to employees highlighted that LinkedIn would focus on its Chinese strategy of assisting companies operating in China to hire, market, and train abroad. “This will involve maintaining our Talent, Marketing, and Learning businesses while phasing out InCareer, our local jobs app in China, by August 9, 2023,” he added.

He admitted that despite some success in the past year, “thanks to our strong China-based team,” InCareer also encountered fierce competition and a challenging macroeconomic climate. “Mohawk and Jian will convene an all-hands meeting with our China-based colleagues in the coming hours to discuss the implications of these changes, including the discontinuation of product and engineering teams in China and the downsizing of corporate, sales and marketing functions,” he concluded.