Zuckerberg says sorry for 11,000 layoffs in Meta, I got this wrong

Zuckerberg says 'sorry' for 11,000 layoffs in Meta, 'I got this wrong'

Amid a spate of technology companies going in for job cuts in recent weeks or planning to pause hiring, Meta Platforms Inc chief executive officer Mark Zuckerberg has sacked more than 11,000 employees, which is equal to about 13 per cent of the workforce.

The social media giant will also extend its hiring freeze through the first quarter, said the Zuckerberg in a statement sent to Meta employees and posted on its website on Wednesday (November 9). Zuckerberg also took accountability for these “most difficult changes” they have made in Meta’s history.

“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13 per cent and let more than 11,000 of our talented employees go,” said Zuckerberg.

“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,” he said. Further, he wrote in a blog post, “There is no good way to do a layoff, but we hope to get all the relevant information to you as quickly as possible and then do whatever we can to support you through this.”

Also read: Meta to begin layoffs today; Zuckerberg accepts blame for ‘missteps

Besides the job cuts that will happen across the country, Meta will also announce more cost-cutting measures in the coming months, said the company. They will also reduce their real estate footprint, review their infrastructure spending and some employees are expected to transit to desk sharing.

The first round of redundancies in the company’s history comes after its workforce peaked this year at 87,314, said media reports.

Meta’s declining fortunes

Meta, whose stock plunged 71 per cent this year, has had several quarters of disappointing earnings and a slide in revenue. There has also been a significant slowdown in the digital advertising market, and the downturn in the economy compounded with Zuckerberg’s multi-billion-dollar investment in a speculative virtual-reality push called the metaverse, has aggravated the situation.

Zuckerberg said Meta had overinvested at the start of COVID-19, banking on a surge in online activity even after the pandemic ended. “But the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than expected. I got this wrong, and I take responsibility for that,” he said.

Meta’s severance package

The company is offering US employees severance pay starting at 16 weeks, Zuckerberg’s note said, as well as six months of healthcare support. Those on immigrant visas would receive help from “dedicated immigration specialists” but Zuckerberg acknowledged that the cuts were “especially difficult if you’re here on a visa”. Packages will be similar outside the US, in keeping with local employment laws, it said.

Also read: Facebook parent Meta Q3 revenue, profit decline

In late September itself, Zuckerberg had warned employees that Meta intended to slash expenses and restructure teams to adapt to a changing market. When a hiring freeze was implemented in Instagram and WhatsApp, he had indicated that Meta’s headcount will shrink in 2023.

Investments into Metaverse

Despite fingers pointed at Zuckerberg for the large-scale investment in the company’s virtual reality project, which resulted in more than $10bn being spent on research and development each quarter, the CEO insisted in the note that the pivot remained a “high-priority growth area”. As also are Meta’s AI discovery engine, ads and business platforms.

Zuckerberg has been pouring billions into his vision of the metaverse, a collection of digital worlds accessed through virtual and augmented-reality devices. This requires a lot of investment in hardware and research that may not yield immediate returns.

Layoffs in tech companies

The massive job cuts in Meta, follows thousands of layoffs at other tech giants, including Elon Musk-owned Twitter and Microsoft Corp. Twitter Inc cut roughly half of its workforce last week with many employees, while Salesforce Inc recently said it has cut hundreds of workers from sales teams. Apple Inc, Amazon.com Inc and Alphabet Inc. have all slowed or paused hiring.

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