Facebook Parent Company Meta Is Preparing Large-Scale Employee Layoffs

Meta, the parent company of Facebook, has been reportedly preparing for mass employee layoffs this week. It was first reported by the Wall Street Journal on Sunday, citing numerous sources familiar with the matter.

The Meta employee layoffs were seen to be the first large-scale dismissals in the company's 18-year history. According to CNET, the Facebook parent company was reportedly eyeing to cut its costs by at least 10% within the next few months.

Meta has employed 87,000 workers. Meta CEO Mark Zuckerberg said during the company's third-quarter earnings call late last month that downsizing the workforce could be imminent.

Zuckerberg noted that the company will focus its "investments on a small number of high priority growth areas" in 2023. He added that it could mean that some teams will "grow meaningfully," while other teams "will stay flat or shrink over the next year."

Zuckerberg then noted that they expect to end 2023 with roughly the same size or "even a slightly smaller organization." The Meta chief executive said that he expects the metaverse investments to take about a decade before seeing promising results.

Meta Company Employee Layoffs

Mark Zuckerberg also said he had to freeze hiring, shutter projects, and reorganize teams to reduce costs. The social media company had cut plans to hire engineers by at least 30% in June. Zuckerberg also warned employees to prepare for an economic decline.

Meta's shareholder Altimeter Capital Management noted in its open letter to Zuckerberg that the company needs to streamline by decreasing jobs and capital expenditure. It added that Meta had lost investor confidence as it increased spending and turned to the metaverse.

In July, Zuckerberg said the company was experiencing one of the "worst downturns that we've seen in recent history," The New York Times reported. He added that workers should be prepared to do more work with fewer resources, and their performances would be reviewed more intensely than previously.

Zuckerberg said at the time that "self-selection" was fine with him. He noted that there were probably some people who were part of the company "who shouldn't be here."

Meta's business has been affected by privacy changes that Apple imposed, which hindered the ability of many apps to target mobile ads to users.

The bulk of Meta's revenue, which is digital advertising, has also weakened as advertisers backed out. The employee layoffs are seen to happen by the end of the week, joining other tech companies with their employment cutoff.

Tech Large-Scale Employee Layoffs

Meta is not the first tech company to impose large-scale employee layoffs. Twitter's workforce has already been reduced by its new CEO, Elon Musk.

Previous reports indicated that as much as half the company's 3,700 workers had been affected by last week's layoffs. Musk could reportedly lay off 25% and as much as 75% of the workforce.

Rideshare company Lyft was also reported to lay off 13% of its staff, with job cuts affecting around 650 employees. In July, Lyft had already laid off 60 workers.

A Microsoft spokesperson noted that there will also be employment cuts in the company, which would be 1% of its 180,000 workers. The spokesperson noted that the company will review its business priorities regularly while making "structural adjustments accordingly."

This article is owned by Latin Post.

Written by: Mary Webber

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