Mark Zuckerberg fires 11,000 Meta employees in industry's biggest layoff
Meta has joined the list of tech giants that have made significant job cuts. Mark Zuckerberg, the company's CEO, has sacked over 11,000 employees. This is the biggest layoff in the technology sector yet. The decision to fire these many people comes after the company's lukewarm performance in recent quarters. Twitter had earlier axed roughly 50% of its workforce.
Why does this story matter?
We are living in an era where tech companies are paying for their aggressive hiring and investments they made during the pandemic. Meta has joined the list of companies that also includes Twitter, Snap, and Microsoft, among others. What makes Meta's headcount reduction different is simply the enormous number. This is probably the start of a new culture in the company.
Employees will get 16 months of pay as severance
With the mass layoff, Meta's workforce will be cut by 13%. In his blog post, Zuckerberg said that axed employees in the US will get 16 weeks of base pay plus two additional weeks for every year of service. Employees will also get their remaining PTO, cost of healthcare for three months for employees and their families, and three months of career support.
Employees outside US will get similar benefits
The laid-off employees will receive their RSU (restricted stock unit) vesting. They will also get unpublished job leads. Zuckerberg also promised immigration support to employees in the US. Employees outside the country will also get similar benefits by taking into account local employment laws.
Zuckerberg took accountability for making some poor decisions
In his letter to the employees, Zuckerberg took responsibility for some of the poor decisions he made after the pandemic. He said that he believed that the online boom during COVID-19 would carry over to the period after the pandemic. "I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected," he added.
Meta is facing challenges on various fronts
This year, Meta's stocks have fallen by over 70%. The company has pointed to the worsening macroeconomic conditions as the main reason behind this. However, the truth is that Meta is facing challenges to its social media business, mainly from TikTok. The falling digital ad revenue due to Apple's new privacy policy is another major reason. Then we have the massive spending on Metaverse.
