Another round of layoffs is coming to Facebook parent Meta Platforms as CEO Mark Zuckerberg continues his “year of efficiency.”
Key Details
- Just a few months after a mass layoff of around 11,000 workers, Meta has announced another 10,000 worker layoffs and will withdraw 5,000 open roles, The Hustle reports.
- The combined layoffs account for a 25% reduction of Meta’s overall workforce.
- In an announcement posted to Facebook, Zuckerberg shared that the company will be restructuring and focusing on “flattening (its) orgs, canceling lower priority projects, and reducing (its) hiring rates.”
- This new round of layoffs will raise Meta’s annual revenue per employee to as much as $1.85 million, according to The Wall Street Journal.
- While this projection depends on the social-media platform recovering some of its lost ad revenue, other tech companies are paying attention to the potential for greater earnings.
Why it’s news
The tech layoffs just keep coming, and it is still only the beginning of 2023. Annual layoffs have reached 138,652 so far this year.
Meta’s continuing layoffs represent some level of concern for other tech workers in the industry. Meta hired too quickly following the pandemic and is now trying to course correct. However, rising layoffs mean employees have fewer options and less negotiating power when job hunting.
Tech companies looking for talent just a few years ago offered perks and bonuses to lure prospective employees. Fewer businesses are begging tech workers to come to them, The Hustle reports.
Other Big Tech companies are closely watching Zuckerberg’s “year of efficiency” to see if it works. If Meta’s harsh layoffs successfully bring the company more revenue, other tech companies could follow suit.
When Meta’s hiring soared over the last year, the company’s annual revenue per employee dropped to the lowest level since 2014—about $1.35 million. The new expected annual revenue could reach as high as $1.85 million if Meta recovers some of its lost ad revenue.
Growth is not for certain, though. Even if Meta sees no revenue growth this year, the layoffs will increase the company’s revenue per employee by about 16% more than its rates over the last five years.