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Meta announces another round of layoffs to achieve efficiency goals

The move is part of the company’s “Year of Efficiency” management theme 

 Meta, the parent company of Facebook and Instagram, has announced that it will be conducting another round of layoffs as early as this week, with the aim of cutting thousands of employees, this according to various US news agencies.  

The move is part of the company’s “Year of Efficiency” management theme for 2023, according to a statement by Meta CEO Mark Zuckerberg during the company’s fourth-quarter earnings report on February 1. 

The technology firm has already been giving buyout packages to managers and cutting “nonessential” teams, with the largest round of layoffs to date occurring in November 2022 when 13% of the workforce, more than 11,000 employees, were cut. In addition, the company has reduced discretionary spending and extended its hiring freeze through the first quarter of 2023. 

The new round of layoffs was expected after Meta reportedly issued “subpar ratings” to thousands of employees in their recent performance reviews, with approximately 10% of workers receiving ratings indicating that they were underperforming. Furthermore, the social media giant cut a bonus metric to 85% of its target. 

“We’ve always had a goal-based culture of high performance, and our review process is intended to incentivize long-term thinking and high-quality work, while helping employees get actionable feedback,” said a Meta spokesperson in response to the performance review ratings. 

“In this new environment, we need to become more capital efficient,” Zuckerberg said in a letter to employees in November. “We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We’re restructuring teams to increase our efficiency. But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go.” 

Meta gave many of its employees a month to apply for different positions within the company in September, with re-organizing departments expected to be merely the first step toward larger staff reductions. In July, engineering managers at Meta were tasked with identifying anyone on their team who “needs support” and reporting them in an internal HR system. 

Maher Saba, the company’s Head of Engineering commented: “If a direct report is coasting or is a low performer, they are not who we need; they are failing this company. As a manager, you cannot allow someone to be net neutral or negative for Meta.” 

Meta’s upcoming round of layoffs will continue its efforts to become a more efficient organization and achieve its long-term goals. 

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Taiwan – Nike, Adidas shoe supplier Pou Chen to slash 6,000 jobs in Vietnam

Adidas, is one of the largest employers in Ho Chi Minh City, with 50,500 workers

Reports by the Straits Times have stated that Taiwan’s Pou Chen Corp, the world’s largest manufacturer of branded sports footwear, plans to cut around 6,000 jobs at its Ho Chi Minh City factory in Vietnam in several phases this year due to weak demand, citing two local officials familiar with the company’s plans. The firm’s PouYuen Vietnam factory will cut 3,000 jobs this month and will not extend the labour contracts for 3,000 other workers later this year, the officials said, who declined to be identified because they were not authorised to speak to media.

The PouYuen Vietnam factory, which supplies goods to global companies such as Nike and Adidas, is one of the largest employers in Ho Chi Minh City, with 50,500 workers. “The company will prudently respond to the dynamic changes in the business environment,” Pou Chen said in a filing to the Taiwan Stock Exchange.

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Dell to lay off 6,650 workers

This totals 5% of its workforce

Dell has announced plans to lay off 5% of its workforce, or about 6,650 employees, according to an SEC filing.

The cuts at Dell come as demand for PCs and laptops has slowed globally. Global shipments of PCs were down 28% year over year in the fourth quarter of 2022, according to industry analysts at IDC. Computer shipments at Dell fell 37% for that same period, while competitors Lenovo, HP and Apple were down 28%, 29% and 2%, respectively.

Shares of Dell closed down 3% Monday.

In a memo to employees, Jeff Clarke, Co-Chief Operating Officer at Dell, said the cuts were made in an effort to “stay ahead of downturn impacts.” He said the moves Dell had already implemented, like limiting travel, pausing external hiring and reducing outside services spending, were no longer sufficient.

Clarke said: “Unfortunately, with changes like this, some members of our team will be leaving the company. There is no tougher decision, but one we had to make for our long-term health and success.”

As of Jan. 28, 2022, Dell had 133,000 total employees, according to a company filing with the SEC. In the memo to employees, Clarke said Dell has navigated economic downturns before, and “emerged stronger” as a result.

“We will be ready when the market rebounds,” he wrote. But this is cold comfort for those who have lost their jobs.

The company’s layoff announcement marks the latest round of job cuts in the tech industry, as PayPal on Tuesday announced plans to cut 2,000 jobs. In January, Google revealed plans to lay off more than 12,000 workers, Microsoft disclosed plans to cut 10,000 employees and Salesforce announced plans to lay off 7,000 workers.

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Big Tech roundup

Construction recruitment firm Skillit announced a $5.1 million seed round led by Building Ventures

It’s been a big month in Big Tech with Microsoft Corp. announcing its multibillion-dollar investment in OpenAI, the startup behind ChatGPT. Skillit also reported a $5.1 million seed funding round, Spotify announced layoffs, and employer-of-record platform Deel reported revenue…

Microsoft

Microsoft announced the third phase of a long-term partnership with OpenAI, the San Francisco-based artificial intelligence research firm, through a multiyear, multibillion-dollar investment to accelerate AI breakthroughs. OpenAI is the startup behind ChatGPT, an AI tool that enables users to ask questions everyday language and delivers responses that appear as if humans wrote them. Some see ChatGPT has having an impact on the workforce solutions ecosystem.

Satya Nadella, Chairman and CEO of Microsoft said: “We formed our partnership with OpenAI around a shared ambition to responsibly advance cutting-edge AI research and democratize AI as a new technology platform. In this next phase of our partnership, developers and organizations across industries will have access to the best AI infrastructure, models, and toolchain with Azure to build and run their applications.”

The agreement follows Microsoft’s previous investments in 2019 and 2021 and extends its ongoing collaboration across AI supercomputing and research. It also enables commercializing of the resulting advanced AI technologies.

Skillit

Skillit, a recruiting platform for skilled, full-time construction labor based in New York, announced a $5.1 million seed round led by Building Ventures with participation from MetaProp, Holt Ventures, Great North Ventures, 1Sharpe Ventures and Takeoff Capital.

Fraser Patterson, CEO and founder of Skillit commented: “Deskless workers make up 80% of the global workforce. In construction, they are the foundation of the built world and make the $1.6 trillion in annual construction spending happen. Yet we know almost nothing about them because there have been very few purpose-built solutions that meet the needs of skilled workers and hiring managers.”

Skillit provides contractors with vetted candidate profiles, custom matching, automated workflows and data-driven compensation and labor market insights.

Spotify

According to CNBC, Spotify announced that it is cutting 6% of its global workforce as the music streaming company contends with a gloomy economic environment that has seen consumers and advertisers limit their spending. Spotify has a workforce of around 9,800 people, meaning the layoff impacted about 600 employees.

Deel

Employer-of-record provider Deel has announced in a blog post that it had annual recurring revenue of $295 million in 2022, became EBITDA-positive and hit a valuation of $12 billion.

Deel also announced it was launching a global HR platform to enable companies to manage their entire workforce, including directly hired employees, international workers and contractors. In addition, it announced a set of HR Slack plugins and began offering an in-house payroll engine.

Earlier this month, Deel announced it acquired Capbase, a fintech firm based in San Francisco.

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Amazon UK warehouse shake-up places 1,200 jobs at risk

The decision comes after Amazon’s recent announcement of cutting 18,000 jobs globally

Amazon has announced its plans to close three warehouses in the UK and open two new major fulfilment centres. This decision may impact 1,200 jobs, but the company says all employees will be offered roles at other existing Amazon locations. The proposed closures include warehouses in Hemel Hempstead, Doncaster and Gourock, in the west of Scotland. The new sites, which are planned to open in Peddimore in the West Midlands and Stockton-on-Tees in the North East, are expected to create 2,500 jobs over the next three years.

A spokesperson for Amazon stated that the company is always evaluating its network to ensure it meets the needs of the business and improves the experience for its employees and customers. The closure of these sites, as well as the opening of new ones, is a part of this ongoing process. They also highlighted that employees affected by the closure will be offered the opportunity to transfer to other facilities.

The union representing some of the workers at the Hemel Hempstead site expressed disappointment with the decision, and is sceptical about the possibility of finding alternative work for all affected employees. The company has acknowledged that the Gourock location has less scope for alternative work within Amazon and says they will offer retraining and reskilling opportunities to affected employees.

Steve Garelick, GMB union officer for Hemel Hempstead, commented: “Disappointed for the workers and disappointed for the town and a deep concern this is the thin end of the wedge for the local area.

“Some workers may be offered alternative roles but decamping to Luton, Dunstable or Milton Keynes isn’t as practical as you might think.”

This decision comes after Amazon’s recent announcement of cutting 18,000 jobs globally and joins other tech giants in mass redundancies. Amazon has over 1.5 million employees worldwide, with 300,000 in corporate roles that are likely to be affected by the worldwide cuts.

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Tech companies have laid off 33,000 staff in the last month

Amazon joins big tech companies in staff cuts

EmployBridge, the largest industrial staffing firm based on US revenue, is laying off 171 employees across the US, according to a Worker Adjustment and Retraining Notification, or WARN notice, filed with the Georgia Department of Labor. Amazon is also reportedly laying off personnel, while Twitter is adding to its previously reported staff cuts.

Citing according to a source familiar with the EmployBridge layoffs, the Atlanta Business Chronicle reported that the affected employees are a mix of full-time and part-time workers who have back-office support roles such as in information technology support, accounting or human resources.

EmployBridge this month announced it completed its acquisition of Bluecrew, a Chicago-based online provider of industrial workers on a W-2 basis. Atlanta-based EmployBridge places more than 450,000 temporary associates annually via 446 offices in 48 states. It was acquired by Apollo Global Management Inc. in 2021.

Amazon this week also began cutting jobs across the company. Managers have begun informing employees that they have two months to find another role inside the company or accept severance, according to media reports.

TechCrunch reported that the company allegedly plans to lay off 10,000 – comprising roughly 3% of its corporate workforce. The figure would mark the largest “workforce reduction” ever undertaken by the e-commerce and cloud computing giant in its nearly 30-year history.

And Twitter has laid off 4,400 of its 5,500 contractors, CNBC reported. The move follows the layoffs of approximately half of its internal staff. According to a report from Quartz, counting Twitter and Amazon, major tech companies will have laid off 33,000 workers over the last month.

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Big Tech tumbles staff numbers

Microsoft, Salesforce, Meta and Twitter make mass staff cuts

Big names in Big Tech are letting go of staff at what is said to be the most dramatic cull in tech sector history. Meta has laid off more than 11,000 employees thereby reducing its headcount by around 13 percent, while Microsoft announced at the end of October that it’s laying off around 1,000, with numbers still to be confirmed. Elon Musk led the charge, however, by laying off around half of its workforce when he took control of the social media platform on October 27. This, in a bid to run a financially healthier business by taking it private and enhancing his unilateral power as CEO.

Salesforce has joined the avalanche with an announcement of 2,500 redundancies in the US, with the jury still out on whether or not the mass layoffs will reach UK shores.

Meta, the social media giant, is battling falling revenues and rising competition despite reporting profits in excess of £23 billion. Chief Executive Mark Zuckerberg emailed employees on Wednesday morning informing them of the redundancies.

He said: “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.” Zuckerberg said revenue growth experienced during the pandemic had not been sustained, ad performance was down, and ecommerce had declined, all in an environment of economic downturn.

He added: “[These factors] caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.” Despite drops in share prices and apprehension around Zuckerburg’s Metaverse development, he has said that investment in Real Labs will continue.

Why? the industry is asking. Since the pandemic, the tech industry has seen an explosion of use of and investment in tech, probably since Facebook’s arrival 18 years ago. The result of rising inflation and reduced revenue seem to be the main reasons for the slew of mass redundancies, even in the face of reporting massive revenue over the last year.

Ken Brotherston, TALiNT Partners CEO said: “First of all, it’s only the most dramatic cull in tech history if you’re under 40. The dot com reverse was quicker and deeper in percentage terms but, of course, that isn’t any comfort if you are one of the people affected. What might offer some succour however is that we still have a pretty robust employment market with a lot of the skills previously valued by these big tech firms still in high demand from lots of other employers.”

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