Facebook parent Meta is planning the biggest layoffs in its history.
That's according to reports which say the downsizing is set to happen this week and will impact thousands of workers.
This isn't a shock: Nearly all the biggest tech companies have frozen hiring or let employees go in 2022. Plus, Meta has seen several major stock drops this year as well, thanks largely to the metaverse money-sink that it's betting its future on, in addition to a dwindling net income.
What Meta's Layoffs Might Look Like
The Wall Street Journal first broke this story, citing “people familiar with the matter.”
The layoffs will be announced as soon as Wednesday, they say, and “many thousands of employees” will be out of a job as a result.
A reduction of this size is unprecedented and would be the first broad head-count reduction in Meta's 18 years of existence.
The sheer number of jobs lost will also set a record across the entire tech industry. Meta was starting out with 87,000 employees as of the end of September, however, and so when taken as a percentage of the company, the layoffs still can't touch the recent competition from Twitter, which laid off around 50% of its staff last week.
Why Meta Is Downsizing
Meta's layoffs aren't surprising within the context of the corporation's most recent quarterly report.
Just a few weeks ago, shareholders learned that Meta's net income had dropped 52% year over year, while at the same time headcount had grown 28%. The company's metaverse division, Reality Labs, had lost $3.7 billion in a 3-month period, and that number will only get larger next year.
Soon after this report, Meta's stock dropped 25%, losing the company $80 billion in 24 hours. It's hard not to see Meta's reportedly impending layoffs as a direct response.
Tech Companies Are Tightening Belts
Any entrepreneurs or small businesses that rely on social media have a shaky future ahead, given major layoffs that are now or soon will impact Twitter and Facebook. But it's not just social media that's tightening belts.
A recession is on the horizon, and at the same time, the appeal of technology has waned thanks to well-justified concerns over data privacy and engagement-hungry algorithms' influence over the political sphere.
In other words, the boom years are at an end for the tech world, and Meta's major layoffs are the biggest evidence yet.