In a memo to his workers, Meta CEO Mark Zuckerberg announced he’s laying off 11,000 people, representing around 13% of his workforce. Compared to the chaotic way Elon Musk summarily dispatched thousands of Twitter employees, Zuckerberg came across as contrite, empathetic and apologetic.
In the company memo, he wrote, “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history.” The chief executive took responsibility for the layoffs. “I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.”
In addition to the downsizing, Zuckerberg plans to reign in expenses by cutting costs and enacting a hiring freeze.
Meta isn’t alone in downsizing its staff. The startup and tech sectors have cut 104,791 jobs in 2022, according to Layoffs.fyi. Snap, Apple, Microsoft, Intel, Stripe, Lyft and an array of other tech companies have enacted layoffs or hiring freezes.
As a leader in the tech space, despite losing 70% of its stock price and squandering billions of dollars in its disastrous foray into the metaverse, other companies will follow Meta’s lead. Tech and non-tech businesses will feel that if the mighty Meta had to cut staff and costs, they should also consider these options.
The rationale for Zuckerberg’s aggressive hiring spree was prompted by the pandemic that accelerated everyone moving online. E-commerce boomed, and this was thought to become the new normal. Meta miscalculated, believing that this trend would be sustainable. After being locked up for two-plus years, people wanted to go outside and enjoy experiences, such as going to a baseball game or concert, traveling to see family or going on a much-needed vacation.
Why Tech Companies Aggressively Hired
In a competitive field, hiring is seen as an arms race. Each company wants to recruit and retain the best and brightest talent. It’s a preemptive strike to get highly skilled people before their competitors do. Once hired, they’ll hoard the talent.
Managers, being human beings, feed their egos by building a fiefdom to make themselves look important. Social media companies, like Meta, need to invest heavily in personnel to oversee the moderation of daily posts.
Once a person is brought aboard, it’s hard to let them go. There is always a threat of litigation, accompanied by bad publicity, if a person is laid off and accuses the company and its management of discrimination. There is also the basic case of inertia—continually adding headcount on autopilot without questioning if it’s mission-critical or not.
Compassionately Letting Go Of Employees
Zuckerberg’s approach to layoffs was reminiscent of how Airbnb let go of workers during the height of the pandemic. CEO Brian Chesky gave a masterclass in empathy by taking great pains to ensure he took care of his workers, who unfortunately had to be let go.
Zuckerberg said, “There is no good way to do a layoff, but we hope to get all the relevant information to you as quickly as possible and then do whatever we can to support you through this.”
He offered a clear plan to the impacted workers. The company will pay 16 weeks of severance, along with two more weeks for every year of service—no matter how long they worked at the social media platform. People will be paid for their unused paid time off and receive their November 15, 2022 RSU vesting. Health insurance will be covered for six months, and Meta will offer career transition services. For those here in the United States on visas, the company plans to provide guidance and help.
Zuckerberg expressed his gratitude to his team, “This is a sad moment, and there’s no way around that. To those who are leaving, I want to thank you again for everything you’ve put into this place. We would not be where we are today without your hard work, and I’m grateful for your contributions.”
What To Do If You’re Laid Off
Losing your job is a frightening, painful and anxiety-inducing event. It’s especially problematic in a contracting economy, while other firms within the same sector are also downsizing and enacting hiring freezes.
Not only do you feel the loss of your job, but you’ve also temporarily lost your identity that’s tied up with your career. It’s disorienting when you’re cut off from all the colleagues you’ve worked with for the last number of years, and your daily routine is altered.
You will experience a range of emotions. There will be anger over being selected for downsizing. Some people become despondent or depressed. A job loss could cause you to lose confidence. In this current environment, there is real fear about finding a new job and having enough funds to get through this rough patch. The first thing you must do is practice self-care. Take time to process what happened. It’s common to grieve the loss and feel sorry for yourself. However, after a while, you must move forward.
It is important for your mental and emotional health to continue socializing with others. Withdrawing from social engagements is not helpful. There is nothing to be ashamed of. Be honest with people about your situation. You’ll be surprised to learn how many people have been through the same situation. Seek out therapy or consult with a mental health professional if you are having a hard time.
Get in touch with recruiters, career coaches and résumé writers. Contact people in your network to see if they know of any job openings. Target the companies you want to work for and find out if you know anyone who works there. Ask them to share your résumé, along with a recommendation for the job you want at the organization. Go on LinkedIn to post comments, articles and short-form videos to position yourself as an expert in your field to gain attention. Put together an elevator pitch. Practice role-playing commonly asked interview questions.
It Won’t End With Meta—Be Prepared For Future Layoffs
Workers in the tech and startup sectors need to brace for escalating layoffs. The current economic conditions will cause tech companies of all sizes to reconsider their hiring policies to stay competitive and solvent.
The era of artificially low-interest rates is over. Federal Reserve chair Jerome Powell seeks to significantly bring down the 40-year, record-level inflation rates to 2%. To achieve this goal, Powell said there would be a lot of “pain.” Jobs will be cut and hiring freezes will continue to be implemented. Workers will be closely monitored and put on performance improvement plans, as the low-end producers will be targeted for downsizing.
The Fed’s intention of raising the borrowing rates to more than 4% substantially changes the way businesses will operate. By comparison, in March 2020, interest rates were at around 0 to 0.25%. The access to cheap money enabled companies to go on a hiring binge.
When corporations borrow money at a high rate, they need to return a multiple much higher to pay back the interest and debt, employee salaries and the daily costs of running the business. The hurdles will be higher than what the tech firms became accustomed to. Some companies won’t be able to survive this new environment. Private equity firms or companies with the capital to purchase assets at a discount to their prior prices may take them over.
In this new, more austere environment, you’ll need to make yourself indispensable at work to survive. Always keep your eyes open for new opportunities.
Source: Forbes
