Meta plans further job cuts amid delays in setting teams' budgets: report
The uncertainty is making it difficult for managers to plan their workloads
Facebook parent Meta has delayed setting budgets for certain teams as it anticipates more job cuts, the Financial Times reported on Sunday.
This move is part of CEO Mark Zuckerberg's efforts to reduce costs.
Two anonymous employees told the FT that due to a lack of clarity about budgets or headcount, employees have expressed their frustration that "zero work" is being done.
This uncertainty has made it difficult for managers to plan their workloads and some decisions that usually take days to finalise are now taking a month.
"Honestly, it ' s still a mess," said one employee. "The year of efficiency is kicking off with a bunch of people getting paid to do nothing."
Further job cuts are expected around Ma r ch as the company is undergoing performance reviews of staff, as per three current and former employees.
In November, Meta cut more than 11,000 jobs or 13% of its workforce.
Zuckerberg indicated the upcoming layoffs earlier this month during Meta's fourth-quarter earnings call with investors.
"I just think we ' ve entered somewhat of a phase change for the company," he said, according to The Verge.
The CEO further noted that the company staff had been growing steadily for nearly two decades, making it "very hard to really crank on efficiency while you're growing that quickly."
He referred to 2023 as "the year of efficiency" and said that he aims to speed up the decision-making process by removing some layers of middle management.
Zuckerberg added the firm would be "more proactive" about cutting low-priority or low-performing projects.
In some cases, managers are being asked to take on individual contributor roles or leave the company. The move, internally referred to as "the flattening" has caused concerns among employees who fear being demoted.
Wall Street investors last year expressed their frustration with Meta's finances, including its headcount and $10 billion annual investment into metaverse, as the economic slowdown started affecting its earnings.
Earlier this month, Meta announced that it expects its expenses for 2023 to be between $89 billion and $95 billion.
Many tech firms, from Microsoft to Amazon, Meta and Salesforce, have let thousands of employees go since mid-2022 to cope with rising costs and falling demand, caused by inflation and climbing interest rates.
A report from the consulting company Challenger, Gray & Christmas claims that, with businesses preparing for a future recession, layoffs in the US hit a two-year high in January. According to the report, the US tech sector laid off 97,171 employees in 2022: up 649% over the prior year.
Google said last month that it will lay off approximately 6% of its workforce and refocus on its priorities.
Amazon announced job cuts at the company in November and said that the cuts would continue in 2023.
In November, HP announced plans to terminate up to 6,000 employees. Cisco and IBM have both announced job cuts of roughly 4,000 people.
Other companies announcing layoffs in recent months include Microsoft, Twitter, Citrix, Dell, Tibco, Informatica, Salesforce, Intel, Elastic and Aqua Security.