Meta Layoffs: How The Affair Unfolded
Meta, the parent company of Facebook and Whatsapp laid off 13% of the total workforce. Read on to understand how it all unfolded
The whole world is still suffering from the aftermath of the Covid-19 pandemic that has adversely affected millions of lives and international economies. Businesses are still making strategies to recover the losses and grab a fast growth pace, but now the fear of global recession has made the situation even worse. Today, big tech giants are forced to move towards cost-cutting strategies to keep their businesses away from heavy losses.
In a similar event, on November 9, one of the biggest tech giants, Meta, the parent company of Facebook, Instagram and Whatsapp laid off its 11,000 employees, which is 13% of the total workforce. While the numbers are so big and shocking, there were many events that unfolded. Let’s take a deep look at it.
Meta Lays Off 13% Of The Workforce: Worst Tech Layoffs Recorded This Year
On Wednesday, November 9, Meta said it would cut more than 11,000 employees, embarking on its first broad restructuring. The company is working to cope with a slumping digital-ad market and plunging stock prices.
The layoffs were made across departments and regions. The divisions included Facebook, Instagram, Whatsapp and VR division. However, the areas of recruiting and the business team have been affected more than the others. The divisions that were not cut as steeply included engineers working on projects related to the metaverse, the immersive online world. The company also plans other cost-cutting measures like reducing real estate and desk sharing for people who spend more time out of the office.
Many ex-employees have already taken to social media and shared the news of their layoffs.
Why Did The Layoff Happen?
Since the CEO of the Silicon Valley company, Mark Zuckerberg, founded Facebook in 2004, it has steadily hired employees. By the end of September, it had amassed its largest-ever number of workers, totalling 87,314 people. Over the years, Meta spent lavishly accumulating users, buying companies and showering its employees with perks. However, last month, Meta posted its second-quarter revenue decline and stated that its profit was cut in half from the prior year. Once valued at over $1 trillion last year, Meta’s market value has since plunged to around $250 billion. The macroeconomic downturn, increased competition, and ads signal loss have caused the company’s revenue to be much lower than expected.
Hence, the job cuts come as the company confronts a range of challenges to its core business and makes an uncertain and costly bet on pivoting to the metaverse.
WhatsApp India Head And Meta India Public Policy Chief Resign
Meta's India lead for public policy, Rajiv Aggarwal, has also resigned two weeks after Meta India head Ajit Mohan resigned to take up another job at rival Snap. As per the information, Rajiv Aggarwal is also set to pursue another role, and the company wishes him the best in future endeavours.
Also, WhatsApp's India head Abhijit Bose has resigned. Meta has confirmed all the news. Moreover, the tech giant has also announced the appointment of Shivnath Thukral, who was previously serving as the Director of WhatsApp Public Policy in India, as Director of Public Policy for Meta in India across all its platforms.
What The CEO Has To Say About The Massive Layoffs?
The CEO of the company said in a statement, “Unfortunately, this did not play out the way I expected”. “I got this wrong, and I take responsibility for that,” Mr Zuckerberg added.
In a letter to its employees, he addressed the layoff as the most difficult change. He said, "I want to take accountability for these decisions and for how we got here." He also mentioned, "To those who are leaving, I want to thank you again for everything you’ve put into this place."
Meta Layoff: Severance Package, Stock Compensation And Other Support Offered
Mark Zuckerberg stated that employees would be getting 16 weeks of base pay and two additional weeks for every year of service they have offered to Meta, without any cap. Employees will also be given their paid time off.
Laid-off employees would receive their stock compensation for November 15, 2022 and would be provided with health care and insurance coverage for themselves and their families for six months.
The company will also help laid-off employees with three months of career support.
The company will also provide immigration support to people who have joined through H-1B Visa.
Meta To Extend A Hiring Freeze Through The First Quarter Of Next Year
In a blog post, the CEO also announced that Meta would be extending their freeze of hiring throughout Q1.
After Meta Layoffs, The Company Shares See A Nearly 21% Jump
The company’s shares remained under pressure since the start of this year and witnessed a continuous fall. However, after the announcement of the layoffs, Meta’s shares began recovering and the average ticket size that investors are investing in the company has also improved.
Meta’s shares had stood at $338.54 apiece on the US-based stock exchange Nasdaq. But, the stock then started to notice a decline and continued to fall to $88.91 apiece on November 3. Although, Facebook shares started recovering and have consistently risen since then to $117.08 apiece on November 16 on the Nasdaq.