Days after Elon Musk-owned Twitter fired a larger number of employees, now Meta has laid off more than 11,000 of its employees across the globe. Meta is the parent company of social media platforms Facebook, Instagram, and the widely used messaging app WhatsApp. It is notable that Meta’s CEO Mark Zuckerberg had already given the signs of the layoff. In a message posted by Meta CEO Mark Zuckerberg, the company fired more than 11000 employees on Wednesday 9th November 2022, reducing the manpower of the company by around 13%.
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It is notable that Meta has around 87000 employees worldwide, out of which around 11000 are being laid off by the company, in what will likely be the biggest employment layoffs in the history of the business. Silicon Valley is currently being shaken by the revelation that Meta Platforms is to begin its mass layoffs starting today in order to cut costs. Facebook has continually added staff members since Mark Zuckerberg launched the Silicon Valley business in 2004. It had 87,314 employees as of the end of September, which was a record. However, the business, now known as Meta, started making significant employment cuts on Wednesday 9th November 2022.
“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” Mark Zuckerberg wrote in his message announcing the mass layoff. Apart from this, the company is also taking additional steps to cut costs, he said.
“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 wrote. ” We’re also restructuring our business teams more substantially,” he added.
He added that although the cutbacks affected all departments, some, like recruiting, were more severely impacted than others, as the company has also announced a hiring freeze for the time being.
According to reports, Zuckerberg met with executives on Tuesday to discuss the layoffs. According to a witness, the chief executive accepted responsibility for the layoffs and said that his firm had expanded too swiftly. Three other persons stated that Meta had also postponed employee travel so they would be accessible to meet with managers should their team be affected by layoffs.
Mark Zuckerberg further said in message, “At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
He said that the company needs to become more capital efficient, and therefore it has started to cut costs across its business, including scaling back budgets, reducing perks, and shrinking its real estate footprint. “But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go,” he added.
Mark Zuckerberg also revealed the Severance Package for fired employees, which will be 16 weeks of base pay plus two additional weeks for every year of service, with no cap. The employees will be paid for all remaining PTO, and they will receive their November 15, 2022 restricted stock unit vesting. The impacted people and their families will get health insurance coverage for six months. Apart from this, Meta will provide them career support for three months through an external vendor, and people on visas will be provided immigration support.
With the removal of around 11,000 employees taking place immediately, Meta has decided to remove their access to Meta systems today itself, “given the amount of access to sensitive information”. However, the company allowed them to use their company email accounts for the day, “so everyone can say farewell”.
Some other cost-cutting measures announced by the CEO include shrinking its real estate footprint. The company will be transitioning to desk-sharing for people who spend most of their time outside the office. The company will also not hire additional people in the first quarter, apart from some exceptions. “. I’m going to watch our business performance, operational efficiency, and other macroeconomic factors to determine whether and how much we should resume hiring at that point,” Zuckerberg wrote.
The company is also reviewing its spending on infrastructure, and aims to become even more efficient with the existing capacity, while building AI infrastructure.
Stocks of Meta improved with the lay off news
As the layoffs were declared, Meta stock futures went up by over 4.5%. This is a sign that the investors are happy with the decision of the company to cut costs.
BREAKING: Meta stock futures up by over 4.5% amid announcement of mass lay offs
— The Spectator Index (@spectatorindex) November 9, 2022