Facebook’s parent company, Meta, is cutting its workforce by over 13%. 11,000 jobs will be lost as the company regroups amid falling revenue and uncertainty in the tech industry. The announcement comes just a week after Twitter announced it was laying off half of its workforce after Elon Musk’s takeover.
Social media used increased during the pandemic, leading tech companies to hire aggressively, anticipating continued growth of the industry. Meta CEO Mark Zuckerberg said:
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.
Another issue of concern for Facebook and Meta is the billions invested in the creation of the “metaverse,” a virtual reality world hype as being the “new tech,” replacing cell phones and being the premier technology of choice to communicate, a concept that didn’t catch on the way Zuckerberg hoped.
Investors ran for the hills, causing a steep 71% drop in share price – trading at the lowest levels in over seven years.
2022 has seen the biggest revenue decline in history for the company, with no change in the near future. Fall’s quarterly revenue is expected to be an even bigger loss for Meta.
We’ve cut costs across our businesses including scaling back budgets, reducing perks, and shrinking our real estate footprint,” Zuckerberg said. We’re restructuring teams to increase our efficiency. 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.
The former Harvard student told employees on Wednesday that emails would go out letting them know if they still have a job. Those let go will have access immediately revoked. Laid-off employees will receive four months of base pay, two weeks’ compensation for every year with the company, and six months of health insurance for them and their families, The Hill reported.
“We’re keeping email addresses active throughout the day so everyone can say farewell,” Zuckerberg said.
Original reporting by Barbara Ortutay at the Associated Press.
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