Meta, the parent company that owns Facebook, WhatsApp and Instagram, is expected to start mass layoffs as early as this week, according to a new report from the Wall Street Journal. And while it’s not clear exactly how many of Meta’s roughly 87,000 employees will lose their jobs, it’s in the “thousands,” according to the new report.
Meta has tremendous global reach, with over 2.7 billion users on Facebook and 2 billion users on WhatsApp. The company had actually been on a hiring spree over the past three years, with over 37,000 new hires since the start of 2020, according to the Wall Street Journal.
The move would be the first mass layoffs in the history of the company, which recently rebranded itself as Meta in an effort to focus on CEO Mark Zuckerberg’s grand vision for the metaverse. But that vision has not been well executed, according to reports from behind the scenes, where Meta’s product developers don’t even want to use the metaverse. Most people who visit Horizon Worlds don’t return, according to the Wall Street Journal.
Reports from September indicated that Meta planned to cut expenses by about 10%, but it’s not clear how much of that would be in the form of headcount reduction. Meta had a marketcap of roughly $US1 ($1) trillion in September of 2021 back when it was known as Facebook. The company’s current market cap is just $US240 ($333) billion.
The U.S. tech sector has seen several layoffs in recent weeks, with Stripe laying off 14% of its 8,100 employees and Twitter firing about 50% of its employees after Elon Musk took over. Netflix, Spotify, and Shopify have also seen big staff reductions in recent months.
Despite low unemployment, the U.S. has been struggling with high inflation, much like the rest of the world, causing companies to panic about the imminent possibility of a recession. The Federal Reserve has been raising interest rates in an attempt to make more Americans unemployed under the theory that it would slow inflation.
Meta did not respond to a request for comment early Monday. Gizmodo will update this article if we hear back.