Zuckerberg Accepts Responsibility for Meta’s 11,000 Layoffs
On Wednesday, November 9th, Mark Zuckerberg’s parent company Meta, which owns Facebook, Instagram, and WhatsApp, announced they had laid more than 11,000 positions, roughly 13% of the workforce.
The layoffs, according to Meta CEO Mark Zuckerberg, were “some of the most difficult changes we’ve made in Meta’s history.” He promised that all affected employees would receive an email informing them of what the layoff means for them.
He added, “I know this is tough for everyone, and I’m especially sorry to those impacted.”
This is the most substantial round of layoffs in the history of the company. Meta had around 87,000 employees worldwide before the layoffs.
In spite of declining ad revenues and a declining user base, Zuckerberg has invested billions in the struggling Metaverse project, causing Meta’s stock to drop more than 70% this year. Following the announcement of the layoffs, Meta shares increased 5% in premarket trading.
In a memo distributed to the entire company, Zuckerberg apologized for the layoffs and acknowledged that he had miscalculated the degree to which Meta’s revenue would fall amid the recent downturn in the company’s performance.
The Meta CEO acknowledged that the business had overspent during his tenure but added that he had “taken the decision to significantly increase our investments” in the hope that the e-commerce boom of the epidemic era would become a long-lasting trend.
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Zuckerberg stated, “Unfortunately, this did not play out the way I expected.” He added that “not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ad signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
In his letter, Zuckerberg stated that due to the “quantity of access to sensitive information,” the company has decided to “remove access to most Meta systems” for impacted employees.
Additional cost-cutting initiatives were announced by Zuckerberg, such as reducing “discretionary spending” and extending a hiring freeze for the entire company through the first quarter. Employees “who already spend the majority of their time outside the workplace” will be required to share desks by Meta.
Zuckerberg stated that layoffs are seen as a last resort and that the company made other cost-cutting actions prior to this announcement. After attempting to lower the operational costs of the company through other channels, he defended his actions by saying, “this will add up to a meaningful cultural shift in how we operate.”
For months, Zuckerberg had public contradicting views, saying he would prefer to lay off employees. In a meeting in June, he said, “Realistically, there are probably a bunch of people at the company who shouldn’t be here.”
Affected employees at Meta will shortly receive an email, and they will have the chance to ask questions, he added.
Employees in the US will get redundancy payouts equal to 16 weeks of pay plus one week for each year of service. The continuation of family health insurance for another six months will be one of the additional perks.