Mark Zuckerberg, Meta’s CEO, announced that the company is downsizing as it lays off approximately 13% of its employees, mounting over 11,000. The layoffs are a part of a few other steps, like freezing hiring through Q1, that Meta will take to cut down discretionary spending.
Zuckerberg said that the company continuously invested in moving online and digitizing after the world moved online due to the COVID-19 pandemic. At the time, digitizing brought in considerable revenue, which led companies to anticipate outsized revenue growth even after the pandemic ended. However, it did not work out as expected. The digital trends have downturned to the levels prevailing before the pandemic.
To survive the paradigm shift, the company needs to become more capital-efficient. Zuckerberg added, “We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint.”
Meta will compensate all affected employees (US) with severance pay of 16 weeks in addition to two weeks of yearly service. The company will also provide immigration support to help out stationed employees. Other remuneration includes the payment for all remaining PTO tenures, health insurance vesting, career support with an external vendor, and access to job leads.