Video Producer/Editor: Shohini Bose
Over 11,000 Meta employees are now out of a job owing to layoffs at the company that were carried out across departments.
What happened? The big tech firm laid off 13 percent of its workforce on Wednesday, 9 November, according to a report by The New York Times.
Until September 2022, Meta had a total of 87,314 people on its payroll
Ironically, the company’s hiring department has been severely gutted in this round of job cuts.
Why it matters: Believe it or not, layoffs at this scale are not typical of the Silicon Valley-based company which had been steadily hiring more employees since its early stages. This indicates that the firing is no small affair, further suggesting that all is not okay at Menlo Park.
What they’re saying:
“I want to take accountability for these decisions and for how we got here…I know this is tough for everyone, and I’m especially sorry to those impacted,” Mark Zuckerberg, the person who calls the shots, wrote in a letter to employees.
“These cycles of boom and bust are incredibly destructive within organizations because people employed there feel like they don’t know where they stand,” Sandra J Sucher, a Harvard professor who teaches management, was quoted as saying in the NYT report.
By rapidly hiring across all departments during the pandemic, Zuckerberg had set up his company to need reductions in staff, Sucher added.
Picking up the hints: The mass layoffs had been half expected since Meta announced a hiring freeze two months ago. Staffers' travel plans were also reportedly cancelled ahead of the big announcement.
The signs were there: Meta’s quarterly profits saw a 50 percent drop in October and sales declined for the second time in a row. The company's stock prices nosedived by 72 percent this year.
A slump in revenue earned from digital advertising, fuelled by the global economic slowdown, put Meta in a tight spot.
A Meta flop? Zuckerberg's ambitious plans involving the metaverse has reportedly proved too costly for the company, with billions of dollars being spent on developing niche products that may or may not attract users.
Reality Labs, the arm of the company that is focusing on the metaverse, reported operational losses of $3.67 billion – a number that's expected to rise next year.
The division also posted its lowest revenue since the fourth quarter of 2020, according to its earnings report.
With the new business turning out to be a money pit, who called it Metaverse and not Meta-woes?
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)