Why Meta Is Reportedly Planning To Sack More Employees This March
Last November, Facebookās parent company, Meta, undertook its largest-ever downsizing, laying off more thanĀ 11,000 employees. It appears, however, that other staff will soon be given the pink slip.
The Financial Times reported on Saturday that Meta Platforms has put off finalizing the budgets of numerous teams as the companyĀ contemplatesĀ a new round of layoffs.
Meta Feeling The Pinch Of Rising Expenses
The impending terminations are part of CEO Mark Zuckerbergās strategy to reduce expenses. According to three current and former employees of Meta who requested anonymity, layoffs are anticipated to occur in March, as the firm is now conducting employee performance appraisals.
Earlier this month, the firm said that it expectsĀ its 2023 spending to range between $89 billion and $95 billion, a āyear of efficiencyā that has caused ādisruptionā at the social media company, as described by Zuckerberg.
In the last fewĀ weeks, there was a lack of clarity on budgets and future headcount, the Financial Times disclosed, citing two Meta employees familiar with the matter.
Image: MobileSyrup
Before November, Zuckerberg informed analysts that the business might be āsomewhat smallerā by the end of 2023.
The November employment cuts primarily hit Instagram, Whatsapp, and Facebook, while Metaverse positions were mainly spared. The company also announced a hiring freeze for the first three months of 2023 at the time.
A source saidĀ that āseverance and other employeesā accounted for $975 million on Metaās balance sheet, or an average of $88,000 per terminated employee. For the company, layoffs have been a pricey endeavor.
Mark Zuckerberg. Image: Drew Angerer/Getty Images
āHonestly, itās still a mess,ā FT quoted one Meta employee as saying. āThe year of āefficiencyā is kicking off with a bunch of people getting paid to do nothing.ā
āFlatteningā The Organizational Structure
During a recent earnings call, Zuckerberg addressed the difficult decision to reduce the workforce further:
āI said clearly that this was the beginning of our focus on efficiency and not the end,ā Zuckerberg said, citing middle management as the next target.
Zuckerberg also stated in his Facebook post that they are working on āflatteningā their organizational structure and stripping away some components of middle management in order to make decisions more quickly.
Internally dubbed āthe flattening,ā some employees are afraid that individuals who switch roles are essentially being demoted, according to a source.
āAs part of this, weāre going to be more proactive about cutting projects that arenāt performing or may no longer be as crucial,ā Zuckerberg said. The plan includes deploying Artificial Intelligence tools to help Meta engineers be more productive, he added.
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The metaverse, a largely unfulfilled virtual environment that has disappointed users and could take years to become lucrative ā if it ever does ā is one of Metaās current objectives.
In 2022, the metaverse part of the business, Reality Labs, posted a loss of $13.7 billion, up from a loss of $10.2 billion from the previous year.
-Featured image from Listverse