Facebook parent company, Meta, has confirmed that it will embark on a massive layoff of a large number of its workforce. The company said on Wednesday that it is reducing its staff number by 13% – which amounts to 11,000 of its 87,000 workforce.
In the statement released on the company’s official page, company CEO, Mark Zuckerberg, said that the action is done in reaction to the challenges the company is facing, and further added that Meta will be cutting its spending.
“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go. We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.”
Zuckerberg added that Meta will be shifting its resources to a number of smaller and high priority growth areas. These areas include Meta’s AI discovery engine, its advertisements and business platforms and Zuckerberg’s much-discussed long-term vision for the development of the Metaverse.
“We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We’re restructuring teams to increase our efficiency. But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go,” Zuckerberg added.
The job cuts come amid a tough time for Meta, which provided lukewarm guidance in late October for its upcoming fourth-quarter earnings that spooked investors and caused its shares to sink nearly 20%.
Meta’s investors have been concerned about the company’s rising costs and expenses, which jumped 19% year over year in the third quarter to $22.1 billion. On the flip side, the company’s overall sales declined by 4% to $27.71 billion in the quarter while its operating income also dropped by 46% from the previous year to $5.66 billion.
According to the statement released earlier today, Meta said it will pay affected staff 16 weeks of base pay, plus two additional weeks for every year of service. The company also added that it will cover health insurance of the affected workers and their families for 6 months, and provide three months of career support with an external vendor, including early access to unpublished job leads.
As regards the immigrant workers, Meta said it will give them adequate support.
“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.”
