10,000 Meta jobs to be axed amid ‘Year of Efficiency’

10,000 Meta jobs to be axed amid ‘Year of Efficiency’

15 Mar    Finance News, News

The owner of Facebook and Instagram will cut another 10,000 jobs, months after laying off 11,000 staff, as the technology group prepares for years of economic disruption.

Meta Platforms unveiled a fresh wave of redundancies as it battens down the hatches, announcing it would also shut about 5,000 additional vacant roles that it had not yet filled and cancel “lower priority” projects.

“This will be tough, and there’s no way around that,” Mark Zuckerberg, its chairman and chief executive, told employees. Tech companies worldwide are scrambling to cut costs amid apprehension over the economic outlook.

Zuckerberg, 38, suggested that junior employees work better from the office, at least for part of the week.

“Engineers earlier in their career perform better on average when they work in-person with teammates at least three days a week,” he told staff, citing “early analysis of performance data” that required further study. “But our hypothesis is that it is still easier to build trust in person and that those relationships help us work more effectively.”

Shares in Meta closed up 7.3 per cent, or $13.12, at $194.02 in New York last night after it outlined the latest stage of its drive to cut costs. The group has promised to reduce expenses by $5 billion as part of a “Year of Efficiency” in 2023, having endured a stock market rout in 2022 amid concern over the strength of the online advertising market, and its spending.

The stock endured a sharp decline in 2022, in the face of mounting fears over the economy, a digital advertising slowdown and intense scrutiny of its investment in the metaverse, an immersive digital realm that many in Silicon Valley deem to be the future of the internet. However, they have rebounded strongly since the start of the year.

Asked about specific plans for the UK, where it had some 5,000 staff before the first wave of layoffs, a Meta spokesman declined to comment further.

Last year amounted to a “humbling wake-up call” for Meta after years of rapid sales growth, Zuckerberg said in a 2,200-word memo, as the economy turned, competition from rival platforms including TikTok intensified and the company’s growth slowed.

“At this point, I think we should prepare ourselves for the possibility that this new economic reality will continue for many years,” he said. “Higher interest rates lead to the economy running leaner, more geopolitical instability leads to more volatility, and increased regulation leads to slower growth and increased costs of innovation.”

Meta, which is based in Menlo Park, California, was founded by Zuckerberg in 2004. The company has 3.74 billion monthly active users across its platforms, which also include WhatsApp, and a market value of almost $500 billion. It had more than 87,000 employees last autumn, after years of rapid recruitment, before announcing the first wave of lay-offs in November.

So far this year, some 128,000 lay-offs have been announced across the sector, according to Layoffs.fyi, a tracker.

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