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China's Baidu to Raise Staff Salaries Amid COVID-19 Virus Outbreak

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(Reuters)

Image for Representation (Reuters)

Government efforts to stop the spread of COVID-19 in China have hit companies hard, causing them to cut salaries and lay off workers to fight declining demand.

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China's Baidu Inc will raise staff salaries amid the coronavirus outbreak, the search engine company's CEO told staff in a meeting, two sources familiar with the matter said. Robin Li also told staff that the company had a cash pile of around 130 billion yuan ($18.5 billion), the sources said. In its fourth-quarter earnings report, Baidu said it had a cash position of 135.9 billion yuan. Baidu did not respond to a request for immediate comment.

The company said last month that its first-quarter revenue could fall as much as 13 per cent from a year earlier citing a hit to its advertising sales due to the outbreak and China's slowing economy.

Li's comments come as government efforts to curb the spread of the virus have disrupted supply chains and severely hit consumer demand, causing mounting stress for many Chinese companies, some of which have started to lay off workers, cut salaries or shut down completely.

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