‘Metaverse’ Vision in Doubt as Mark Zuckerberg Lays Off 11,000 Meta Employees
The cut, which reduced Meta’s numbers by about 13 percent, is the result of revenue spikes and some subsequent poor investment decisions on Zuckerberg’s part. In his memo, Zuckerberg said he wanted to “take accountability” for the layoffs and “how [Meta] got here.” The executive cited rapid e-commerce growth during the height of the COVID-19 pandemic, which turned into outsized revenue for Meta. What Zuckerberg chose to do with that extra money was—according to the CEO himself—not the wisest decision he could have made.
While every team is said to have been affected by the reduction, some were naturally hit harder than others. Resources have allegedly been shifted toward the metaverse, Meta’s AI discovery engine, and its ad and business platforms (the last of which has historically been Meta’s bread and butter). Recruiting teams, however, have seen a significant dip as the company extends its hiring freeze through Q1 2023.
Zuckerberg noted that displaced employees will receive a number of transitory benefits in the months following their termination, including extra time on payroll, extended healthcare, immigration support, and help with finding a new job. The remaining shell-shocked employees will meanwhile see a slew of additional cost-cutting measures introduced in the near future, like reduced office space and desk-sharing among hybrid employees.
Many notable tech companies have conducted mass layoffs this year, citing economic uncertainty as the primary reason for the cuts. While Zuckerberg did mention the current macroeconomic downturn as a contributor to Meta’s struggles, his company has been on fire for some time now. Social media users are turning to TikTok for interaction and entertainment, leading Meta to try (and largely fail) to push Reels. Apple’s iOS privacy rules are affecting the Facebook and Instagram apps’ ability to track user engagement and charge more for ads. And Zuckerberg can’t stop shoveling money into the metaverse, despite a general lack of user interest. This means Meta employees aren’t the only ones taking the brunt of Zuckerberg’s poor decisions—this year alone, the executive’s personal wealth has dropped by more than $100 billion, while Meta’s value has tanked by over 71 percent as of October.
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