It would be the tech company’s second round of cuts since November. Mark Zuckerberg, its chief executive, has declared 2023 the “year of efficiency.”
Meta, the owner of Facebook and Instagram, said on Tuesday that it planned to lay off about 10,000 employees, or roughly 13 percent of its work force, the latest move to hew to what the company’s founder, Mark Zuckerberg, has called a “year of efficiency.”
The layoffs will affect Meta’s recruiting team this week, with a restructuring of its tech and business groups to come in April and May, Mr. Zuckerberg said in a memo posted on the company’s website. The announcement is the company’s second round of cuts within the past half year. In November, Meta laid off more than 11,000 people, or about 13 percent of its work force at the time.
Meta also plans to close about 5,000 job postings that have yet to be filled, Mr. Zuckerberg said in the memo. Other restructuring efforts include a plan to wrap up this summer an analysis of Meta’s hybrid return-to-office model, which it began testing last March.
“This will be tough and there’s no way around that,” he wrote.
Meta’s stock rose more than 7 percent by the close of trading on Tuesday.
Mr. Zuckerberg is culling employees after years of hiring at a breakneck pace. His company gobbled up workers as its family of apps, which also includes WhatsApp, became popular worldwide. The coronavirus pandemic also supercharged the use of mobile apps, leading to more growth. At its peak last year, Meta had 87,000 full-time employees.
But as the global economy soured, and digital advertising markets contracted last year, Mr. Zuckerberg began putting an end to unchecked growth. Meta trimmed employee perks. And after the layoffs in November, which largely affected the business divisions and recruiting teams, Mr. Zuckerberg hinted at further cuts.
On an earnings call in February, the chief executive said he did not want the company to be overstuffed with a layer of middle management, or “managers managing managers.” He said he took responsibility for last year’s layoffs, blaming his zeal for staffing up on the surge of use early in the pandemic.
Meta’s layoffs are part of a wave of job cuts from the biggest tech companies. In recent months, Amazon, Google, Microsoft, Salesforce and others have also said they are trimming their ranks, and some of the companies have increased the number of people they are letting go after initial announcements. Many of the companies have cited a challenging global economic environment for their actions.
But even beyond the macroeconomic conditions, Meta is dealing with many challenges. It is grappling not only with a digital advertising slowdown but also with Apple’s privacy changes to its mobile operating system, which have restricted Meta’s ability to collect data on iPhone users to help target ads. It also faces steep competition from TikTok, which has soared in popularity over the past few years. And regulators have stepped up efforts to rein in the company by pushing for new laws that would limit Meta’s data collection abilities.
Meta is also in the midst of a tricky transition to become a “metaverse” company, connecting people to an immersive digital world through virtual-reality headsets and applications. Mr. Zuckerberg sees the metaverse as the next-generation computing platform, so Meta has been spending billions of dollars on the effort and reallocating workers to its Reality Labs division, which is focused on products for the metaverse.
Yet it’s unclear if people will want to use metaverse products. In recent months, the public has instead gravitated to chatbots, which are built on artificial intelligence. Meta has invested in A.I. for years but lately has not been at the center of the conversation about the technology.
Employees have been bracing for more layoffs for months, watching with anxiety as Mr. Zuckerberg embarked on a quest to dial back what he felt was no longer necessary to run the company, according to current and former employees. But the expectation was that he would take a light touch to his favored project of the metaverse.
Some Meta employees who were affected by Tuesday’s announcement of layoffs — especially in the recruiting division — felt “gut-punched,” according to current and former employees who have spoken with those in the organization.
“People are entering a job market that is the worst I’ve ever seen,” said Erin Sumner, a global director of human resources at DeleteMe, who was laid off from Facebook in November. She said the staggered nature of Meta’s cuts over the next two months was adding to employee anxiety.
“There’s a lot of uncertainty,” Ms. Sumner said. “There’s a lot of anger, and there’s the question many folks are asking: ‘How do you expect me to do work for the next two months while wondering if I will still have a job?’”
In his announcement on Tuesday, Mr. Zuckerberg laid out a vision for streamlining the company by removing layers of management, ending lower-priority projects and rebalancing product teams with a focus on engineering.
To that end, Mr. Zuckerberg wound down efforts on building NFTs, or nonfungible tokens, a cryptocurrency-based initiative that has dropped out of favor in recent months. Many of Mr. Zuckerberg’s crypto initiatives in general have fallen by the wayside over the past nine months as the public has grown more skeptical of the market after the implosion of FTX, the cryptocurrency exchange.
In his note, Mr. Zuckerberg added that the moves were a response to global conditions, including increased regulation, geopolitical instability, higher interest rates and a cooling economy.
“The world economy changed, competitive pressures grew and our growth slowed considerably,” he said. “We should prepare ourselves for the possibility that this new economic reality will continue for many years.”
Gregory Schmidt contributed reporting.
Source: Economy - nytimes.com
