CEO Mark Zuckerberg tells staff to brace for a deep economic downturn, as Meta cuts its hiring plans by at least 30 percent
Meta Platforms has reportedly signalled that it is also bracing for a serious economic downturn and has slashed its hiring plans.
According to Reuters, CEO Mark Zuckerberg told staff on Thursday that Meta has cut plans to hire engineers by at least 30 percent this year, as he warned them to brace for a deep economic downturn.
Meta is not alone. Tesla is already restructuring its operations and is in the process of axing 10,000 jobs, after Elon Musk announced he had a “super bad feeling” about the economy and planned to cut headcount by 10 percent and “pause all hiring worldwide.”
In May it was reported that Microsoft had adopted a more cautious approach to hiring new people, amid growing concern at the global economic situation.
This comes as the world faces inflationary pressures, rising fuel costs and food prices, caused in part by Russia’s illegal invasion of Ukraine, and the economic fallout resulting from lockdowns imposed during the global Coronavirus pandemic.
And now Meta (Facebook) is reportedly bracing itself for stiff economic headwinds.
“If I had to bet, I’d say that this might be one of the worst downturns that we’ve seen in recent history,” Zuckerberg was quoted as telling staff in a weekly employee Q&A session – audio of which was heard by Reuters.
Meta has reduced its target for hiring engineers in 2022 to around 6,000-7,000, down from an initial plan to hire about 10,000 new engineers, Zuckerberg reportedly said.
Meta confirmed hiring pauses in broad terms last month, but exact figures have not previously been reported.
“Shouldn’t be here”
In addition to reducing hiring, Zuckerberg reportedly said, the company was leaving certain positions unfilled in response to attrition and “turning up the heat” on performance management to weed out staffers unable to meet more aggressive goals.
“Realistically, there are probably a bunch of people at the company who shouldn’t be here,” Zuckerberg reportedly said. Harsh.
“Part of my hope by raising expectations and having more aggressive goals, and just kind of turning up the heat a little bit, is that I think some of you might decide that this place isn’t for you, and that self-selection is OK with me,” he reportedly said.
Last month, Sheryl Sandberg, the chief operating officer of both Meta and Facebook, and one of the most high profile woman in the tech industry, announced she would step down from her role in the Autumn.
Reuters has also seen an internal memo which reveals that the firm is bracing for a leaner second half of the year, as it confronts macroeconomic pressures and Apple iOS privacy impacts to its vital advertising business.
Besides regulatory challenges, Facebook is facing increased competition from the likes of TikTok and YouTube grabbing user (particularly youth) attention, as well as a squeeze of advertising revenue, and Apple’s privacy changes start to impact.
The company must “prioritise more ruthlessly” and “operate leaner, meaner, better executing teams,” chief product officer Chris Cox wrote in the memo, which appeared on the company’s internal discussion forum Workplace before the Q&A.
“I have to underscore that we are in serious times here and the headwinds are fierce. We need to execute flawlessly in an environment of slower growth, where teams should not expect vast influxes of new engineers and budgets,” Cox reportedly wrote.
In May this year, Facebook revealed its daily active users (DAUs) was at 1.929 billion, but for the first time ever this figure was down from 1.930 billion DAUs in the previous quarter.
The Cox memo was “intended to build on what we’ve already said publicly in earnings about the challenges we face and the opportunities we have, where we’re putting more of our energy toward addressing,” a Meta spokesperson told Reuters in a statement.
The guidance is the latest rough forecast to come from Meta executives, who already moved to trim costs across much of the company this year in the face of slowing ad sales and user growth.