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SXSW Lays Off One-Third of Staff After Festival Canceled: ‘Only Way to Stop the Bleeding’

The 2020 edition of SXSW was canceled by the Austin city government because of the coronavirus outbreak.

Crowds Move Through the Austin Convention Center on the Second Day of South by Southwest in Austin Texas Usa 08 March 2014 South by Southwest (sxsw) Conferences and Festivals Offer the Unique Convergence of Original Music Independent Films and Emerging Technologies United States AustinUsa South by Southwest - Mar 2014

The crowd at SXSW

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SXSW has laid off at least 50 employees since the 2020 festival was canceled by the Austin city government due to concerns regarding the worldwide coronavirus outbreak. The layoffs represent one-third of the SXSW staff, which is said to have been around 175 employees prior to the festival’s cancellation (via Variety). The 2020 edition of SXSW was supposed to take place March 13-22. SXSW co-founder and CEO Roland Swenson told the Wall Street Journal the SXSW organization stands to lose “tens of millions of dollars.” The executive added that while the company is planning to put on a festival in 2021, “how we’re going to do that I’m not entirely sure.”

The festival wrote in a statement regarding the company layoffs: “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 SXSW lay offs were first announced by The Austin Chronicle. The publication reported the lay offs spanned all departments of the SXSW organization and included new hires and longtime staffers. Staffers who were laid off are receiving severance pay. A “high-ranking official” told The Chronicle the mass layoffs were “the only way to stop the bleeding” that’s happening at the organization following the 2020 cancellation.

Swenson told WSJ the event’s lack of insurance for a virus outbreak is causing the most financial damage to the organization. “We’ve had to show our insurance policy to all kinds of people, and nobody ever said, ‘Hey, there’s a big hole here,'” the executive said. “We did not anticipate a pandemic. We’d always taken the attitude of, ‘Well, we’ll never cancel, so that’s not going to be an issue.’”

SXSW 2020 was the first major festival to be canceled because of the coronavirus festival. All eyes are on upcoming film festivals such as Tribeca and Cannes to see if the outbreak has a similar effect.

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