Meta employees fear job cuts as cost-cutting revealed
Zuckerberg says Meta will probably be smaller in 2023 than it was in 2022.
Employees at Facebook parent Meta have been warned about potential layoffs after the company announced it would freeze hiring and restructure teams in response to the uncertain macroeconomic situation.
According to Bloomberg, CEO Mark Zuckerberg told employees that the company would cut budget for the majority of teams, and each team would need to resolve how to manage headcount changes.
The cuts might mean Meta doesn't fill open positions when workers leave. It could also move people to other teams, or try to "manage out" underperformers.
"I had hoped the economy would have more clearly stabilised by now, but from what we're seeing it doesn't yet seem like it has, so we want to plan somewhat conservatively," Zuckerberg told employees. He added that the company would end 2023 as a "somewhat smaller" organisation.
Zuckerberg explained that the freeze was required because the management doesn't want to add individuals to teams where "we don't anticipate to have positions next year."
Meta is currently dealing with several challenges, in part because of its transition from a social media company to one that focuses on metaverse operations.
It is also facing difficulties from the continuing fallout of Apple's changes to its privacy settings; a drop-off in the use of its Facebook mobile app; people spending less time online as the pandemic eases; and uncertainty caused by Russia's invasion of Ukraine.
In June, Meta lowered its goal for recruiting engineers in 2022 to 6,000-7,000, down from an early aim of around 10,000.
In the weekly Q&A announcing the cuts, Zuckerberg warned staff to prepare for a difficult second half of the year.
An internal message from chief product officer Chris Cox also reflected that mind-set. He told employees these are "serious times" for Meta, and "the headwinds are fierce." He emphasised that the challenges were unlikely to end anytime soon.
Cox also detailed the company's top six investment objectives for the second half of the year. They are metaverse products; AI; messaging; Reels; monetisation; and meeting new privacy requirements.
In February, Meta reported that Facebook lost about 1 million daily active users worldwide in Q4'21, its first-ever loss of subscribers, although quarterly and net revenue remained strong.
It wasn't until July that Meta reported its first-ever quarterly revenue decrease since going public in 2012.
Following growth that accelerated during the pandemic, the tech industry is something of a lull today. Many firms are halting or suspending hiring as a result of the broader global economic slowdown, increasing interest rates, and regulatory challenges.
Apple, Twitter, and Amazon have all announced hiring freezes, blaming the uncertain global economic situation.
Google parent Alphabet has announced a hiring freeze beginning July, and Apple has said that it will slow its hiring process in 2023.