Meta is trying to improve its business model with fewer workers and more efficiency —and moving the metaverse to a long-term vision.
In the face of economic challenges in the US, Meta, the social media behemoth, has announced job cuts to stay competitive and continue to invest in the metaverse. On March 14th, Meta CEO and founder Mark Zuckerberg revealed that the company will dismiss 10,000 employees to increase efficiency in 2023.
Zuckerberg stated that Meta’s primary goals are to enhance its technology prowess and improve financial performance amid the harsh economic climate in the country. These actions align with the company’s long-term vision.
He further explained that the company must bolster productivity and developer tools to attain its goals. It also must eliminate unnecessary processes and non-essential roles by streamlining its operations.
“In the coming months, our organizational leaders will unveil restructuring plans aimed at flattening our organizations, scrapping lower-priority projects, and lowering our recruitment rates. Given this hiring reduction, I have made the tough decision to further cut down the size of our recruiting team.”
Massive Layoffs Begin Tomorrow
Meta’s CEO announced that the most recent of a larger wave of layoffs affecting 10,000 employees will begin tomorrow, with the dismissals spanning three months. The company also revealed that it would shut down 5,000 positions.
“Overall, we anticipate reducing our team size by roughly 10,000 people and closing about 5,000 other unfilled positions.”
As a result, a significant portion of the recruitment team may lose their jobs, and they will be notified of their dismissal on March 15th.
Moreover, the company hinted that further restructuring and layoffs affecting the technology team would be disclosed by late April. The final round of dismissals involving the business team will occur in late May.
Zuckerberg cautioned that the layoffs could continue throughout the year, even if it means parting ways with talented colleagues who contributed to the company’s success.
Meta’s Focus on the Metaverse is a Long-Term Thing
To enhance agility and effectiveness, Meta plans to eliminate multiple management levels by requiring many managers to become individual contributors. According to Zuckerberg, this approach would facilitate faster information flow between workers, as managers do not need more than ten direct subordinates.
“We believe that managing each person is essential, so we generally don’t want managers to have more than ten direct reports.”
On March 13th, Meta Platforms’ Head of Commerce and Financial Technologies, Stéphane Kasriel, announced the company’s decision to drop support for non-fungible token (NFT) projects to prioritize other initiatives that support content creators.
Kasriel emphasized that Meta would continue supporting content creators who leverage the company’s social media platforms, such as Instagram and Facebook, to showcase their NFT collections. Nonetheless, the company is shutting down unprofitable projects following Reality Labs’ staggering loss of $13.7 billion, responsible for key metaverse projects.
However, Meta has made clear that the bad ending of its NFT business does not mean it is changing course. AI is now an immediate focus for the company, while metaverse developments remain a long-term, more complex vision.
Meta’s layoff announcement reflects the harsh economic reality many companies face today. The company’s strategic decision to prioritize the metaverse aligns with its long-term vision and could pay off handsomely in the future.