Meta, the parent company of Facebook, announced on Tuesday that it had lost 10,000 jobs, Reuters reported. This is the company’s second mass layoff in the past few weeks. And this is a sign that the technology industry is preparing for a deep economic downturn.
These job cuts are part of a larger restructuring that will see the company also lay off 5,000 people, cancel lower-priority projects, and reorganize its structure by removing intermediate levels.
“I think we need to prepare for this new economic reality to persist for years to come,” Chief Executive Mark Zuckerberg said in a staff address.
The meta also pays for strategic choices that don’t pay off.
Fears of a slowdown in economic growth due to rising interest rates have triggered a series of massive job cuts at US technology companies (Amazon.com and Microsoft) and beyond in the IT and finance sectors.
The meta also pays for strategic choices that don’t pay off. The company has invested billions of dollars in the construction of the metaverse, but has not yet achieved the expected success. The company also has to cope with the collapse in advertising spending since the pandemic. Mark Zuckerberg has promised to make 2023 a “year of efficiency” in response to this context.
In November, Meta decided to cut its workforce by 11,000 people, the first mass layoff in its 18-year history. But its workforce at the end of 2022 was 86,482, up 20% from the previous year.
Mr. Zuckerberg then said he made the wrong bet based on what happened during the COVID-19 pandemic when everyone went digital. “At the start of Covid, the world quickly moved online and the surge in e-commerce has led to excessive revenue growth. Many people have predicted that this will be a permanent acceleration that will continue even after the end of the pandemic. I did that too. and so I have made the decision to significantly increase our investment.”
“Unfortunately, things didn’t go the way I expected. Not only is online commerce back on track, but the macroeconomic downturn, increased competition, and loss of advertising signal have resulted in our revenues being much lower than I expected. wrong, and I take responsibility for it.”