NJust a few months after extensive job cuts, Meta followed up with another austerity program. The American Internet company announced on Tuesday that it would be separating from 10,000 employees. In addition, 5,000 open positions that have not yet been filled should be deleted. In November, Meta announced that it would cut 11,000 jobs. Meta’s stock price rose nearly 5 percent at times on Tuesday. The stock lost around 65 percent of its value in 2022, but has gained more than 50 percent since the beginning of the year.
“We need to work more efficiently,” CEO Mark Zuckerberg said in a note to employees, and the first job cuts aren’t enough for that. When presenting the business results at the beginning of February, Zuckerberg had already proclaimed a “Year of Efficiency” for his company. He also said at the time that the layoffs announced so far were just the beginning of a greater focus on efficiency and hinted at further steps to cut costs. In addition to personnel cuts, this should also include “proactive” ending projects that are no longer viewed as strategically crucial.
Zuckerberg somberly described Meta’s position in announcing the renewed downsizing: “The past year has been a humbling wake-up call. The global economy has changed, competitive pressures have increased, and our growth has slowed significantly.” Zuckerberg was also pessimistic about the future: “I think we have to brace ourselves for the possibility that this new economic reality will last for many years .”
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Meta suffered a drop in sales in 2022 for the first time in its history. The company is struggling in a difficult environment in the advertising business, its main source of income. He is also struggling with increased competition from the smartphone app Tiktok. Also, stricter data rules on Apple devices impede the collection of user information, making it harder to tailor ads to individual users.
Meta had 86,500 employees at the end of last year. This includes many jobs that were to be cut as part of the first round of layoffs, compared to 87,300 three months earlier. The two rounds of layoffs come after Meta has rapidly expanded its workforce in recent years. Even after the cuts, the group will probably still have more employees than at the end of 2021, when there were almost 72,000.
Unusual amount of advance
Zuckerberg announced the renewed job cuts with an unusually long lead time by American standards. As he said, layoffs should start at the end of April, initially on technical positions. Other departments are to follow in May. The time frame for foreign branches can be different. Overall, the restructuring could drag on until the end of the year. At the end of this process, the current hiring freezes will be lifted.
Zuckerberg had already announced in February that he wanted to cut management levels. Now he said many such levels should be dropped. Meta will ask many managers to become “individual employees”. In general, the focus should be placed more on technical positions and the proportion of software developers in the workforce should increase.