HomeInvesting NewsMeta Platforms Inc Reduces Staff in Cost-Cutting Push

Meta Platforms Inc Reduces Staff in Cost-Cutting Push

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According to persons with knowledge of the plans, Facebook’s parent company wants to cut costs by at least 10%, while Google has mandated that some staff apply for new positions.

Meta Platforms Inc Cost Reduction Plan

According to persons with knowledge of the company’s plans, Meta Platforms Inc (NASDAQ: META) wants to reduce costs by at least 10% in the upcoming months, including laying off employees. The social media juggernaut is struggling with stagnant growth and heightened competition.

Current and former managers familiar with the situation claim that the Menlo Park, California-based company has quietly begun to let go of a sizable number of employees by reorganizing departments and giving affected workers a limited amount of time to apply for other positions within the organization in order to achieve staffing cuts without issuing pink slips to many workers.

People familiar with the company’s plans say the cuts will be a stepping stone to deeper ones. According to the sources, while some savings are expected from reduced overhead and consulting costs, the majority of savings are expected from reduced employment.

The steps come after several weeks of public remarks by Meta Platforms Inc leadership about the need for hiring freezes and “ruthless prioritizing” of its activities, but without mentioning the word layoffs.

In response to inquiries, Meta Platforms Inc (NASDAQ: META) spokesperson Tracy Clayton cited CEO Mark Zuckerberg’s July declaration that the company would need to reallocate resources toward corporate goals as constraints on the business increase.

We’ve been open about the fact that our teams must change to meet these difficulties, according to Mr. Clayton. Giving displaced workers a window of time to apply for other positions, he claimed, is a way to keep talent that Meta might otherwise lose. How the latest changes have impacted many employees was not disclosed by him.

The company has been reducing its guidance for operational expenses ever since the third quarter of last year. However, the company has never before said that it will naturally lower headcount through means other than attrition.

Some Meta Platforms Inc employees refer to the procedure for reapplying for positions within a specific time frame as “the 30-Day List,” which they refer to as a form of human resources hell.

Employees whose responsibilities are abolished are vulnerable to firing if they can’t find a new job within a month, a strategy that has long been used by Meta Platforms Inc, the parent company of Facebook, as of last year. Numerous other businesses likewise attempt to redeploy workers whose groups are dissolved or reformed.

In the past, at Meta Platforms Inc, only those workers who were viewed negatively were frequently denied promotions. According to those impacted by this, employees with solid reputations and positive performance ratings are now routinely being let go.

The number of employees recorded by Meta at the end of the second quarter was 83,553, which is a 32% rise over the same time the previous year.

Alphabet Inc. has implemented its cost-cutting measures.

Google has also mandated that some employees apply for new positions to stay at the company. According to persons familiar with the decision, Google informed about half of the more than 100 staff members at Area 120, the company’s startup incubator, last week that they had 90 days to find other roles.

According to those familiar with the procedure, Google typically provides employees who have had their jobs slashed 60 days to apply for other positions inside the company. However, Area 120 employees usually get a longer time if their projects are canceled.

For a group of more than 100 employees in the cloud computing sector, more than 1,400 Google employees signed a petition in March asking the corporation to extend the standard 60-day timeframe to 180 days. They cited the “barriers to transfer that many workers encounter.”

A Google official claimed that over 95% of workers who desired to remain with the company did so within the time allotted for notice. At the end of the second quarter, Alphabet had 174,014, up 20.8% from the same period last year.

After the largest corporations hired quickly during the pandemic, there have been significant personnel reductions in Silicon Valley. Tom Allison, the CEO of the Facebook app, penned a document titled “Why is Hiring So Hard Right Now?” in May 2021. “There is a significant discrepancy between our employment needs and skill availability,” Mr. Allison bemoaned. The organization, he said, was recruiting additional recruiters when the shortage of engineers was at its worst, but even those were difficult to come by.

 

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