Facebook may quietly lay off 15 percent of its total headcount amidst the global recession
Meta platforms are quietly carrying out layoffs on Facebook to reduce the headcounts because the global economy’s trouble and declining ad spending impose a severe problem for all the giant tech firms.
A business insider has recently reported that before a recent weekly question-and-answer session between the workforce, and the chief executive officer of Facebook, Mark Zuckerberg, the executives have opened up to the directors across the company that a headcount of 15 percent of people should be tagged as needing support in an internal review process.
The selective restructuring process highlights the possibility of layoffs of about 15 percent of the workforce. They account for around 12,000 employees.
The reports stated that the possibility of layoffs was revealed in a post by Meta worker on a social media platform named Blind, an app popular among tech workers and requires a valid company email address to use the app anonymously.
The person working for Facebook wrote that 15 percent of the employees would be first included in the performance improvement plan and eventually be let go.
The comments have caused turmoil on the social media platform where the other meta workers were discussing how many people the company would let go.
Facebook in a tight spot amid the global scenario:
In Facebook’s employee review process, when an employee is in need of support, it means that the person is considered to be performing below the set-up benchmark goals. Subsequently, the candidates are put in PIP which does not result in layoffs.
Meta staff has started claiming that the company was conducting quiet layoffs. The people who were deemed to be underperforming were given an ultimatum of thirty days to find a new position in the company or leave the job.
Last week, Meta, the parent of Facebook announced a halt in the hiring process and subsequent restructuring as recession fears had surrounded the global economy.
It was not only Facebook that had to go through such drastic changes, several giant tech firms are overcoming the same fears at present. Other firms such as Apple, Microsoft, and Google have joined the bandwagon.
These firms have stopped the process of hiring or have initiated handing out pink slips to their staff to manage costs and maintain operating margins.
Zuckerberg talked to his employees regarding the current scenario in the previous Q&A session, where he talked about his fears regarding the shrinking economy. He had hoped that economy would be stable by now, but it seemed to be a far-fetched dream.
As a result, the company has to plan somewhat conservatively.
In addition, he said that Facebook would cut budgets across most teams, and the individual teams have to figure out on their own how will they manage the headcount changes. Meta has stated that they have slowed down the process of hiring engineers by 30 percent in June this year.
Meta platforms have become the latest giant tech firm to slow down the hiring process because of the prolonged inflation that the Russian-Ukraine war has inflicted on the global economy, followed by global supply chain shortages and decreasing advertising spending.
On Tuesday, WTO chief Okonjo Iweala said that the world has been moving towards a global recession due to many colliding crises and called for policies that would increase and revive growth.
She has said now is already the time to start the recovery process.
Publicly-traded IT stocks hit a bad start at the beginning of the year, and it resulted in poor performance during the first two quarters of the year.
According to data sourced from reports, over 32,000 workers in giant tech firms, including Microsoft, apple has been laid off in mass job cuts till late July. The layoffs have even been observed in Netflix, Uber, and many cryptocurrency exchanges and lending platforms.
In August 2022, Apple, one of the key players in the tech industry, fired about 100 contract workers to rationalize the hiring and spending process.
The statement was highlighted by Tim Cook, who called the move deliberate after monitoring the firm’s earnings in the second quarter.
Microsoft has met the same fate, which fell short of the expected earnings in the June quarter. The company laid off 1 percent or 1800 employees in July and later laid off 200 more employees from one of its customer focussed R&D projects in August.
And the worst part about the situation is that the recovery of the economy is a far-fetched dream.
Facebook has made a dominant position in the mobile advertising market but, it faces severe competition with other applications in the same genre from ByteDance’s TikTok.
The US Federal Reserve struggling to combat the rising inflation and global macroeconomic condition, is yet to fasten the process while the giant tech firms are taking the worst toll around the world.
Edited by Prakriti Arora
