TikTok Owner ByteDance To Lay Off Staff, Close Education Businesses Over New China Tutoring Rules: Report

ByteDance told its staff that it plans to lay off teachers, sales, and advertising employees in its education business, the Reuters report said, quoting "two sources".

TikTok Logo

TikTok owner ByteDance has told its employees that it plans to give the pink slip to staff in its education business, Reuters reported Thursday. The move comes after China imposed sweeping regulations on the private tutoring sector in July.

ByteDance is said to have told its staff that it plans to lay off teachers, sales, and advertising employees in its education business, the Reuters report said, quoting "two sources".

READ | Vodafone Idea Shares Take Massive Hit, Slip 15% After KM Birla Steps Down

To comply with the regulations, the report said, ByteDance will also shut down its preschools that focus on school curriculum and k12 tutoring businesses across China.

ByteDance has not given any official comment on this.

China’s highest governing body, the state council, announced sweeping new rules on July 23, which barred for-profit organisations offering tutoring on the school curriculum, and also foreign investment in such companies. 

The move aimed to boost the country's birth rate by lowering family living costs, the government claimed.

“Parents hope their children ... have a happy childhood, [but] they are afraid they will lose at the starting line in a competition over scores,” China President Xi Jinping said in March.

The rules, however, have left a significant impact on private education firms — a $120 billion industry on which investors had bet billions of dollars in recent years, another Reuters report pointed out.

The new rules mandate that all private institutions offering tutoring in core school subjects are to be registered as non-profit organizations, and the government will not grant any new licenses.