Meta Cutting Another 10,000 Jobs And Instituting Hiring Freeze
Meta Platforms, the corporate parent of Facebook, Instagram and WhatsApp, will cut another 10,000 jobs and undergo a hiring freeze in what CEO Mark Zuckerberg is calling the “Year of Efficiency” for the tech giant.
Along with the layoffs, Meta will also close 5,000 open roles. In a blog post, Zuckerberg said the measures are being taken to “improve organizational efficiency, dramatically increase developer productivity and tooling, optimize distributed work, garbage collect unnecessary processes, and more.”
Late last year, Meta announced it was axing 11,000 staff – about 13% of the entire workforce at that point – and the new round of cuts take that to 21,000, or 26,000 if the hiring freeze is counted. In an SEC filing in January, the company said it had 86,482 employees as of the end of 2022, a tally that was up 20% over the end of 2021 but a number that also included most of the 11,000 workers targeted for layoffs. Meta said it would provide an updated head count as of the end of the first quarter when it reports results this spring. The January filing also noted that the layoffs last November contributed to 2022 restructuring charges of $4.61 billion.
The first round of cuts represented the first major pullback in Meta’s history and came amid belt-tightening across the tech sector. Most tech firms thrived during Covid and launched ambitious expansion plans, only to retrench during the economic downturn of 2022.
Wall Street cheered the news of the latest cutbacks, sending Meta shares up 5% in early trading. At around $190 a share, it is at its highest level since May 2022.
Zuckerberg has faced mounting skepticism about his multi-billion-dollar investments in metaverse technology, which is a money-losing business for Meta thus far but one in which it has staked its future. The company changed its name from Facebook to Meta in 2021 to reflect its new strategic focus, but many questions remain about the economic models of the metaverse and its viability as a profit engine for a large tech player.
In the blog post, Zuckerberg addressed what he termed his “Year of Efficiency” strategy. “As I’ve talked about efficiency this year, I’ve said that part of our work will involve removing jobs — and that will be in service of both building a leaner, more technical company and improving our business performance to enable our long term vision,” he wrote.
After announcing the cuts, he added: “I’ve tried to be open about all the work that’s underway, and while I know many of you are energized by this, I also recognize that the idea of upcoming org changes creates uncertainty and stress. My hope is to make these org changes as soon as possible in the year so we can get past this period of uncertainty and focus on the critical work ahead.”
Over coming months, Meta chiefs will announce restructuring plans “focused on flattening” their organizations, cancel “lower priority projects” and reduce hiring rates.
“With less hiring, I’ve made the difficult decision to further reduce the size of our recruiting team,” he added. “We will let recruiting team members know tomorrow whether they’re impacted. We expect to announce restructurings and layoffs in our tech groups in late April, and then our business groups in late May. In a small number of cases, it may take through the end of the year to complete these changes. Our timelines for international teams will also look different, and local leaders will follow up with more details.”
Zuckerberg said removing layers of management would be key to the ‘Year of Efficiency,’ with many managers asked to become “individual contributors” as part of a new system aimed at speeding up the information flow between the top and bottom levels.
Other managers will take on more reports, though Meta broadly doesn’t like more than 10 reports per manager.
Zuckerberg claimed that since reducing staff numbers less than six months ago “one surprising result is that many things have gone faster,” and admitted he had “underestimated the indirect costs of lower priority projects.”
“A leaner org will execute its highest priorities faster,” he added. “People will be more productive, and their work will be more fun and fulfilling. We will become an even greater magnet for the most talented people. That’s why in our Year of Efficiency, we are focused on canceling projects that are duplicative or lower priority and making every organization as lean as possible.”
Dade Hayes contributed to this report.