Facebook and WhatsApp’s parent firm Meta Platforms on Wednesday said it will sack more than 11,000 employees or 13 per cent of its total workforce.
Meta CEO and co-founder Mark Zuckerberg said, “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 blamed the rapid acceleration that tech companies had seen post-Covid, which led to a decline in revenue.
“Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected,” he added.
The job cuts were expected, considering the company’s struggle in view of recession fears and slowdown in the digital advertising market.
In July, Meta also posted its first quarterly revenue decline in history, followed by another in October.
In September, Meta announced a pause in hiring and a subsequent restructuring with Mark Zuckerberg adding “there are probably a bunch of people at the company who shouldn’t be here.”
The job cuts came a couple of weeks after the company reported weak quarterly earnings and issued a grim guidance for the next quarter.
Here’s how much the sacked Meta employees will get:
Zuckerberg said the company will pay 16 weeks of base pay plus two additional weeks for every year of service with no cap to all employees who are impacted.
The company will also provide “dedicated immigration specialists” to those who are in the US on a work visa.
“I know this is especially difficult if you’re here on a visa. There’s a notice period before termination and some visa grace periods, which means everyone will have time to make plans and work through their immigration status. We have dedicated immigration specialists to help guide you based on what you and your family need,” Zuckerberg said.
It will also pay for all Paid Time Off (PTO) which is remaining for employees. All employees impacted will receive their dues by November 15, 2022 vesting.
Meta will cover the cost of healthcare for people and their families for six months.
The company also plans to provide three months of career support with an external vendor, including early access to unpublished job leads.
The layoff will impact every department in organisation across Facebook, Instagram, WhatsApp, Messenger, etc.
It also plans other cost-cutting measures such as “reducing real estate footprint,” and “transitioning to desk sharing for people who already spend most of their time outside the office.” More such changes will roll out in the coming months.
Meta in October forecasted a weak holiday quarter and significantly more costs next year, wiping about $67 billion off the company's stock market value, adding to the more than half a trillion dollars in value already lost this year.
The disappointing outlook comes as Meta is contending with slowing global economic growth, competition from TikTok, privacy changes from Apple, concerns about massive spending on the metaverse and the ever-present threat of regulation.