- Meta has started its latest round of layoffs, focusing on technical employees, following its first and second rounds of mass layoffs in November and March, cutting a total of 21,000 jobs. The company’s restructuring strategy is to cut costs, streamline the business and remove underperforming projects that do not align with its goals.
- Despite the downsizing and restructuring, Meta’s shares have soared about 80% this year, outperforming the tech-heavy Nasdaq Composite’s 16% rise in the period. However, with the restructuring, Meta is also shedding lower-priority projects and “flattening” layers of middle management, causing frustration and low morale among some employees.
- The tech industry is now facing a reckoning after years of big salaries and competitive perks for employees. Although there are still many doors open for the future of technical jobs, it may take a while to get back to a kind of normal.
Year Of Efficiency
Meta’s “year of efficiency” is starting to affect the morale of some employees at the company. On Wednesday, the parent company of Facebook and Instagram started carrying out another round of job cuts following mass layoffs in November, reportedly affecting 4,000 employees this time. And some workers took to internal company chats to vent their frustration of the changing environment at the tech giant.
Meta’s restructuring strategy, which involves cutting costs, streamlining the business, and removing underperforming projects that do not align with its goals, has led to the shedding of several technical roles. Meta CEO Mark Zuckerberg’s bet on the metaverse and Reality Labs unit has also led to massive losses. Last quarter, Reality Labs recorded a $4.28 billion operating loss, bringing the unit’s total losses for 2022 to $13.72 billion.
Despite the pandemic-driven boom in digital advertising and cloud computing, tech giants such as Meta have been struggling with declining ad revenues and profitability. In response, Meta CEO Mark Zuckerberg has declared 2023 the “year of efficiency” and initiated a massive cost-cutting drive that has resulted in thousands of job losses over two rounds of layoffs in November and March. The latest round of cuts, which began in April, has focused on technical roles, with the company saying goodbye to people in user experience, software engineering, graphics programming, and other related positions.
As per recent news, Meta has started laying off employees from its product-facing and gameplay programming teams as part of this round of layoffs. Multiple people who worked as gameplay programmers, according to a Meta job listing, were affected by the layoffs. Many impacted employees have taken to social media platforms like LinkedIn to share news about being laid off.
Betting on AI instead
Meta is focusing on streamlining the business, shelving lower-priority projects, and “flattening” layers of middle management. Investors, however, have applauded the downsizing, with Meta’s stock price soaring about 80% this year, outperforming the tech-heavy Nasdaq Composite’s 16% rise.
The company is now betting big on AI instead of the metaverse- a virtual world, in which the company had previously spent billions of dollars a quarter developing technology. The metaverse represented a huge and risky bet on a nascent market that’s yet to crack the mainstream, and it remains to be seen whether it will pay off. For now, AI and the fervor that has come with it has been tempting to Zuckerberg
However, the current layoffs and cost-cutting drive have adversely impacted the morale and confidence of many high performers who work with intensity at Meta. The changing environment at the tech giant has prompted expressions of frustration from employees, with some questioning why they should stay at Meta.
Despite the setbacks, there are still many opportunities available in technical roles. With the digital economy becoming increasingly important in our lives, there will always be a demand for people with technical skills. While it may take a while for the job market to recover from the pandemic and the recent layoffs, the future of technology jobs remains bright.
Meta’s gamble with the metaverse has not paid off yet, and the company has suffered significant setbacks, including declining revenue and profitability, job losses, and declining morale among its employees. However, there are still many opportunities available in technical roles, and the future of technical jobs remains bright. It remains to be seen whether Meta’s bet on the metaverse will ultimately pay off, but the company’s recent cost-cutting drive may put it on a more sustainable footing in the short term.