Mark Zuckerberg says that the decision was made due to the economic situation, the drop in advertising revenue and the need to transform the company into a more efficient company.
On November 9, 2022, Mark Zuckerberg decided to share a letter with his Meta employees (company that owns Facebook, Instagram and WhatsApp), announcing the dismissal of 13% of its workers:
Also read: Apple Hires Facebook Veteran as Chief Information Officer
“Today I am sharing some of the most difficult changes we have made in the history of Meta. I have decided to reduce the size of our team by 13% and let go of more than 11,000 of our talented employees. We are also taking a number of additional steps to become a more efficient company by reducing discretionary spending and extending our hiring freeze through the first quarter.”
In the letter, Zuckerberg explains that early in the pandemic, the rise of e-commerce led to accelerated growth for Facebook that the company’s CEO predicted would continue over time. This generated positive incentives to motivate more hiring in Meta. However, the trend did not continue in the long term. “Not only has online commerce returned to previous trends, but the macroeconomic downturn, increased competition, and loss of ad signal have caused our revenue to be much lower than I expected. I was wrong and I take responsibility”, can be read in the letter.
After the decline in advertising revenue and the loss of money that the metaverse has represented, the layoffs affected all the business units of the group. As the pandemic situation improved, the average time spent on social media decreased, causing the company’s revenue to drop dramatically. These cuts also included a decrease in jobs, so some employees will have to share a table. In addition, there will be no new hires until after the first quarter of 2023.
Currently, a large part of Meta’s investments are focused on the metaverse, since Zuckerberg would have bet a lot of money on the project that, he considered, would become the future of the Internet. For this reason, he invested 11 billion dollars in the project throughout 2022. However, the profits have not been comparable: Beat Saberthe most successful video game on the platform, has accumulated only 100 million dollars.
How will you compensate your workers?
Throughout the day, the dismissed received an email with the information of compensation equivalent to 16 weeks of salary, plus two additional weeks for each year in the workforce. This compensation also includes pending vacations and will pay for six months of medical insurance for employees and their families.
Also read: Zuckerberg and the fortune he is losing with the change from Facebook to ‘Meta’
In addition, Zuckerberg promised to help his foreign employees in their work visa procedures. In fact, the letter focuses especially on foreign workers hired by Meta in the United States: “this is especially difficult if you are here with a visa. There is a period of notice before redundancy and some visa grace periods, which means that everyone will have time to make plans and resolve their immigration situation. We have immigration specialists who will guide you based on your needs and those of your family, ”he says.
We would like to give thanks to the writer of this write-up for this incredible web content
Little or fair? This is how Mark Zuckerberg compensated the 11,000 employees he fired