Photo Credit: Dima Solomin
Reports surface of Meta/Facebook’s plans to begin ‘large-scale layoffs’ this week after the company’s stock falls more than 70% year-to-date.
Facebook’s parent company Meta is planning to begin a series of large-scale layoffs this week in what could be the most significant round of tech job cuts following the industry’s rapid growth during the pandemic. The planned layoffs would also be the first large-scale employee reduction to occur in the 18-year history of the company.
The layoffs are expected to affect thousands of employees, as Meta reported more than 87,000 employees at the end of September. According to those familiar with the situation, an official announcement is expected to come as soon as Wednesday. Meta declined requests for comment, but a spokesperson for the company referred to CEO Mark Zuckerberg’s recent statement that the company would focus investments on “a small number of high-priority growth areas.”
“Some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year,” said Zuckerberg during the company’s third-quarter earnings call on October 26. “In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today.”
Like many tech giants, Meta expanded massively during the pandemic with a hiring spree as life and work shifted to accommodate social distancing. The company added more than 27,000 employees in 2020 and 2021 combined, with an additional 15,344 in the first nine months of 2022.
Meta’s stock has fallen more than 70% this year between deteriorating macroeconomic trends and investors spooked by the company’s spending and changes to its core social media business model. The company also faces harsh competition from TikTok, especially among Gen Z users.
Though Facebook has lost traction as the de facto social media platform in recent years, it and Meta are also heavily involved in licensing deals with the Big Three (Warner Music Group, Universal Music Group, and Sony Music Entertainment). However, only time will tell how much the company’s layoffs will affect the music industry.