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Headspace Hit With More Layoffs, Sparking Concerns About Big Tech & Mental Health

Headspace Hit With More Layoffs, Sparking Concerns About Big Tech & Mental Health

Layoffs at tech-focused mental health companies have prompted concerns from mental health practitioners, who worry about the impact on patients

Headspace Health, a mental health and meditation app company, has laid off 15% of its staff following an initial round of layoffs that impacted 4% of its workforce at the end of last year. 

Headspace merged with Ginger, an online mental health platform, in 2021 in a deal that valued the combined company at $3 billion.

According to Headspace, the recent cuts are designed to put the digital wellness platform on the path to profitability. Headspace provided Athletech News with the following statement regarding the layoffs, which occurred last week:

“With the privilege of supporting the mental health and well-being of millions of people around the world also comes great responsibility to focus on the health of our business and safeguard it for the future. On June 29th, we announced several important changes to our strategy and organizational structure at Headspace, including reducing the size of our workforce by 15%. These changes will equip the company for the future and pave a strong path to profitability. We’re deeply grateful for the employees we said goodbye to and are committed to supporting them through this time of transition.”

The Los Angeles Times reported that the company’s internal memo, penned by CEO Russell Glass, mentioned that the digital well-being company had “underestimated” how much the current economic environment would impact consumer behavior and that the company is committed to being cash-flow positive in 2024. The memo also mentioned upcoming initiatives, including an AI-powered journaling feature. 

A day before the layoffs, Headspace announced it had deepened its partnership with Virgin Pulse, which will give organizations using the well-being platform integrated access to Headspace’s full suite of offerings, such as behavioral health coaching, therapy, psychiatry and employee assistance program services.

Employees Respond 

With pink slips in hand, some Headspace employees took to LinkedIn to announce their departure and signal that they were open to work. 

credit: Headspace Health

While Headspace did not confirm the impacted positions, it appears those in animation, recruitment and digital health departments, as well as mental health practitioners, were among those cut. 

One now-former Headspace employee confirmed that beyond “typical tech employees,” many mental health practitioners were also impacted by the layoffs, who left messages in the comment section for confirmation.

“I am confident that the clinicians that worked there are going to be in high demand,” wrote one recently laid-off Headspace mental health practitioner. “I’ve never worked with more competent clinicians than I had while being at Headspace Health.”

Big Tech & Mental Health: A Dangerous Marriage?

The recent Headspace layoffs bring forth concerns for those in the mental health industry, who question the resulting impact on patients in need. 

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One psychologist referenced the recent layoffs on LinkedIn, writing that she couldn’t help but imagine the repercussions of mental health practitioners being laid off by tech companies, especially as many patients forge intimate relationships with their therapists.

“It seems like breaking down the very support system by which the society and its many people hold onto to find their strength. In a world where the many micro and macro issues already take precedence, laying off (mental health practitioners) destabilizes and can be immensely triggering for the many clients they are working with,” wrote Aakriti Malik, a New Zealand-based licensed clinical psychologist. 

Without singling out Headspace, Malik considers various questions about mental health technology companies that recruit therapists, such as what happens to the client-therapist relationship after a layoff, if tech companies fully understand the layers and processes surrounding grief work, fear of abandonment and termination in therapy, and how mental health tech companies intend to serve society’s well-being amid a recession.

“It’s time mental health tech companies start looking more than just revenues because the stakes here are higher than other jobs/ roles,” wrote Malik. “It may be a layoff of one therapist but the domino effect can be a wildfire.”

Headspace told Athletech News that members whose care providers have left will be transferred to a new Headspace provider for a session within ten days of their original appointment.

“Meeting the needs of our members is of utmost importance to us, and we’re making every effort to find the right provider match for each person and their unique needs,” said Headspace spokesperson Sara Lindsey.”

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