MercadoLibre Bucks Big Tech Layoffs By Adding 13,000 Jobs

Latin America e-commerce leader head count to reach 53,000 Stock has gained 55% this year, outperforming Nasdaq

MercadoLibre Inc., the largest e-commerce company in Latin America, plans to add thousands of jobs this year as it expands its logistics business, even as global tech firms cut jobs and growth cools in the region.

The company will hire 13,000 people, bringing its total headcount to 53,000 in a bet that online ordering will continue to grow, said Sebastian Fernandez Silva, the company’s chief people officer, in an interview. The hiring will be focused on roles involved in locations that sort and send packages in Brazil and Mexico, but will also expand its tech and product teams.

“It’s very important for us to have a stronger, more robust logistics network that allows for faster, cheaper deliveries for users,” he said.

For MercadoLibre, which had 10,000 employees at the end of 2019, the hiring spree seeks to capitalize on a shift in how Latin American consumers are making purchases, a trend that gained momentum during the pandemic. While peers in the US and Europe saw orders slow after governments lifted restrictions, MercadoLibre’s sales continued to grow, with revenue topping $10.5 billion last year, nearly 50% higher than the previous year

The company’s strong performance in e-commerce, as well as its fintech arm, is “likely to persist,” wrote Bloomberg Intelligence senior analyst Jennifer Bartashus following the company’s fourth quarter earnings. Investors have poured into the company’s shares, which are up nearly 55% this year, well ahead of the 16.5% return across the Nasdaq, according to data compiled by Bloomberg.

The new hiring is intended to strengthen the network of fulfillment and service centers that process packages, especially in smaller cities. Fernandez said. He declined to give a number of how many new distribution and service centers would be opened in 2023. In previous statements the company said it plans to invest $3.6 billion in Brazil this year and $1.6 billion in Mexico.

The expansion will be funded through the company’s revenues and not require any additional financing, Fernandez said.

MercadoLibre’s hiring plan defies a trend among tech giants, with companies including Amazon Inc. firing employees this year following a surge in hiring during the pandemic. In its home region, MercadoLibre is facing an economic slowdown with the International Monetary Fund cutting its growth outlook for Latin America this year amid elevated inflation and high interest rates.

Fernandez said MercadoLibre isn’t concerned about hiring too many people or being forced to fire employees going forward.

“We’re very careful about our business decisions, and if we thought there is a risk of overhiring, we wouldn’t do it,” he said. “In all my 19 years at MercadoLibre, we’ve never downsized.”

Here’s how the company plans to focus its hiring:

By sector:

11,000 in logistics

1,700 in tech

600 across other staff and business divisions

By country:

5,800 in Brazil

5,350 in Mexico

800 in Argentina

600 in Chile

600 in Colombia

150 in Uruguay

By Patrick Gillespie and Carolina Millan

This article was published in Bloomberg

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