Meta Rolls Out Final Phase of 10,000 Job Cut Plan, Accelerating Restructuring Efforts

John Lopez, Tech Times 24 May 2023, 12:05 pm

Meta, formerly known as Facebook, has undertaken the last phase of its comprehensive restructuring plan, a move that involves reducing its workforce by 10,000 employees, Reuters reports.

This measure marks the second round of significant layoffs announced by Meta, positioning it as the pioneer among major tech companies to undertake such actions.

Following a period of rapid expansion, the company had previously let go of more than 11,000 employees back in November, bringing its workforce back to mid-2021 levels.

Impact of the Recent Job Cuts

Reports tell us that the recent wave of job cuts primarily impacted employees across multiple departments, including marketing, recruiting, engineering, and research.

Displaced workers took to LinkedIn to share their unfortunate news.

Surprisingly, despite the ongoing downsizing efforts, Meta's shares experienced a significant 0.5% increase in a generally weaker market. Back in February, Meta's share price even reached a peak of 23% increase - making Mark Zuckerberg the 16th richest person according to Forbes.

The company's stock has more than doubled in value this year, partially attributable to its cost-cutting initiatives and its focus on artificial intelligence.

The Meta Layoff Phases

CEO Mark Zuckerberg had previously disclosed that the majority of the second round of layoffs would occur in three phases, with the bulk expected to conclude by May.

However, he acknowledged the potential for subsequent smaller rounds of layoffs. The restructuring process has primarily affected non-engineering roles, underscoring the significance of coding and engineering expertise within Meta.

Zuckerberg emphasized the intention to thoroughly revamp the company's business teams and establish a more balanced ratio of engineers to other roles.

Even within the technology teams, non-engineering positions such as content design and user experience research experienced substantial reductions.

During a company town hall meeting, executives revealed that approximately 4,000 employees were let go in April, with the recruiting teams experiencing a minor reduction in March.

Meta's international headquarters in Dublin will also bear the brunt of the latest job cuts. Nearly 20% of the Irish workforce, equivalent to around 490 employees, are expected to be impacted.

Meta Downsizing Efforts

This downsizing effort reflects the challenges faced by Meta, including decreased revenue growth, rising inflation, and a decline in digital ad spending following the surge in e-commerce during the pandemic.

Furthermore, Meta has invested billions of dollars into its Reality Labs division, which focuses on developing the metaverse and enhancing its infrastructure to support artificial intelligence projects. In 2022 alone, the Reality Labs unit incurred losses totaling $13.7 billion.

As Meta proceeds with the final phase of its restructuring plan, it remains resolute in adapting its operations to maintain competitiveness within the rapidly evolving tech industry.

The company's strategic emphasis on artificial intelligence and metaverse development, combined with its cost-cutting measures, will shape its trajectory as it navigates the evolving landscape of social media and digital innovation.

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