According to officials who participated in a Q&A session with staff on Thursday, Meta, the parent company of Facebook, Instagram, and WhatsApp, expects to begin a new round of employee layoffs next week.
While Meta CEO Mark Zuckerberg alluded to layoffs in May, the precise timing was established during the meeting. According to Vox, the layoffs would mostly affect Meta’s business units and might affect a large number of staff.
“The third wave is going to happen next week. That affects everybody in the biz teams, including in my orgs,” Vox quoted Meta president of global affairs Nick Clegg during the company-wide meeting, which the publication had obtained a recording of.
“It’s just a time of great anxiety and uncertainty. … I wish I could have some easy way of providing solace or comfort. It is uncertain. And actually it’s really increased my admiration for the way that everyone — notwithstanding that uncertainty — you’re just displaying such resilience and professionalism.”
Previous Layoffs
Although business leaders did not specifically specify the size of this wave of layoffs, Mark Zuckerberg had previously indicated in March that Meta planned to reduce 10,000 jobs by the end of May, following an earlier reduction of 11,000 positions in November.
Meta has already slashed roughly 4,000 employees in the previous month, leaving approximately 6,000 positions potentially at risk in this upcoming round. Meta employs over 86,000 people as of the end of 2022.
Clegg noted that the layoffs will follow a similar pattern to the April downsizing, which saw 4,000 positions slashed from Meta’s IT areas, the Vox report said. The afternoon before the layoffs, Meta’s head of people will send an email to all workers outlining when the process will begin and which teams would be affected. staff affected by the layoffs will be told first, followed by staff who are not affected. According to Clegg, the corporation will ask all employees “whose job allows” to work from home.
Why is this Happening?
According to a Mint report, this is happening at Meta for a number of reasons. The first is a misunderstanding of the online landscape. Following Covid, the world quickly migrated online, and the explosion of e-commerce resulted in outsized revenue growth. Many people projected that this would be a long-term acceleration that would last long after the pandemic was over. However, trends reverted to previous levels, as per Zuckerberg.
According to the report, there were also poor business decisions, as Meta considerably boosted its investments based on incorrect assumptions, but the macroeconomic downturn, increased competition, and ad signal loss led Meta’s revenue to be much lower than planned.
In his first layoffs email to employees, Mark Zuckerberg appeared to admit to over-hiring during the pandemic in reaction to people spending more time online. He claimed he made the erroneous decision to increase its investments, but it “did not play out” the way he expected.
Other companies have likewise gone through several rounds of layoffs. Amazon said in January that it would lay off 11,000 employees, followed by another 9,000 layoffs in March. In 2022, this equates to 7% of its total corporate headcount of 380,000. This figure excludes Amazon’s warehousing employees.
According to tech executives, these layoffs were long overdue, as per an Insider report.
Hit on Morale
The ongoing layoffs at Meta are part of Zuckerberg’s ambitions for a “year of efficiency” in 2023, Insider had reported in April this year.
The downsizing is one of the most visible examples of how many major internet businesses, like as Meta, are tightening their belts after nearly two decades of unbroken development, due to overhiring during the pandemic and substantial upheavals in the IT industry at large.
Silicon Valley as a whole has been experiencing an economic crisis, which has dramatically altered what was formerly thought to be the computer industry’s free-spending work culture. While Wall Street has reacted favourably to Meta’s layoffs, they have had a significant impact on workplace morale, the report says.
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