South by Southwest laid off at least 50 employees, or a third of its year-round staff, Monday as the festival faces losses in the tens of millions after the cancellation of this year’s festival.
Said the festival in a statement: “Due to the City of Austin’s unprecedented and unexpected cancellation of the SXSW 2020 events in March, SXSW has been rigorously reviewing our operations, and we are in the unimaginable position of reducing our workforce. Today we said goodbye to approximately one-third of our full-time staff. Those of us in the business of live events know the level of trust required to execute an event of SXSW’s scale, and we are deeply sad to let people go this soon. We are planning for the future and this was a necessary, but heartbreaking, step.” The full-time staff was said to have been around 175 employees.
The statement followed the Wall Street Journal publishing an interview late Sunday with SXSW co-founder and CEO Roland Swenson, who gave a number of “tens of millions of dollars” as a likely loss for the org. “We are planning to carry on and do another event in 2021, but how we’re going to do that I’m not entirely sure,” he told the Journal.
Swenson told the Journal that it would run out of money by this summer if grants or other forms of additional money did not come in. He earlier revealed that the festival’s cancellation insurance policy did not include an extra provision for communicable disease coverage.
The Austin Chronicle confirmed the large number of layoffs Monday, putting the figure at “around 50 people” and attributing an anonymous senior official at the organization who said it was “the only way to stop the bleeding.”
According to the Chronicle, the losses hit staffers across the board, from those who had been with the company for just a few months to some who had been with SXSW for more than a decade. The paper said the departing staffers are being offered severance pay.
Among those confirming via Twitter that they were hit by the cuts was festival publicist Heather Kaplan, who wrote, “Got laid off today, plz send me your favorite songs/shows/movies to cry to.”
Elements of Austin’s tourism business are also expected to be devastated by the cancellation, which SXSW had said had an operational impact of $157 million on the local economy last year.
Talking with the Austin Statesman, mayor Steve Adler said, “They told me they fully intend to come back next year…. They haven’t quite figured out the path yet. But they fully intend to come back.”
In a separate development, Austin city officials, after canceling the festival, also declared that no events with a capacity of more than 2,500 could proceed unless specifically approved by health issues, under the new disaster declaration. Without a waiver, that could affect events looming as quickly as Tuesday night’s Post Malone concert, set to take place at the city’s 16,000-capacity Erwin Center. The city has said it will allow events at mid- and large-size venues to proceed only if “mitigation plans for infectious diseases are in place.”