Facebook parent Meta cuts 11,000 jobs, 13% of workforce; offers immigration support to H-1B visa holders

Mark Zuckerberg, in his statement, said that he expected revenue growth after lockdown was lifted but it did not go as "anticipated" and thus he made the "hard decision" of layoffs. Acknowledging it will be tough for everyone, he said he is "especially sorry to those impacted".

AgenciesUpdated: Thursday, November 10, 2022, 08:37 AM IST
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Facebook parent Meta cuts 11,000 jobs, 13% of workforce; offers immigration support to H-1B visa holders | Image Credit: Wikipedia (Representative)

Facebook parent Meta is laying off 11,000 people, about 13% of its workforce, as it contends with faltering revenue and broader tech industry woes, CEO Mark Zuckerberg said in a letter to employees Wednesday.

The job cuts come just a week after widespread layoffs at Twitter under its new owner, billionaire Elon Musk. There have been numerous job cuts at other tech companies that hired rapidly during the pandemic.

Mark Zuckerberg's statement on layoffs

Zuckerberg as well said that he had made the decision to hire aggressively, anticipating rapid growth even after the pandemic ended. "Unfortunately, this did not play out the way I expected," Zuckerberg said in a prepared statement.

"Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I'd expected. I got this wrong, and I take responsibility for that."

"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," he said.

Meta, like other social media companies, enjoyed a financial boost during the pandemic lockdown era because more people stayed home and scrolled on their phones and computers.

But as the lockdowns ended and people started going outside again, revenue growth began to falter. An economic slowdown and a grim outlook for online advertising - by far Meta's biggest revenue source - have contributed to Meta's woes.

Meta revenue dip

This summer, Meta posted its first quarterly revenue decline in history, followed by another, bigger decline in the fall. Some of the pain is company-specific, while some is tied to broader economic and technological forces.

Meta has worried investors by pouring over $10 billion a year into the "metaverse" as it shifts its focus away from social media. Zuckerberg predicts the metaverse, an immersive digital universe, will eventually replace smartphones as the primary way people use technology.

Meta and its advertisers are bracing for a potential recession. There's also the challenge of Apple's privacy tools, which make it more difficult for social media platforms like Facebook, Instagram and Snap to track people without their consent and target ads to them. Competition from TikTok is also a growing threat as younger people flock to the video sharing app over Instagram, which Meta also owns.

Zuckerberg says layoffs part of downsizing due to revenue dip

"We've cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint," Zuckerberg said.

"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."

Zuckerberg told employees Wednesday that they will receive an email letting them know if they are among those being let go. Access to most company systems will be cut off for people losing their jobs, he said, due to the sensitive nature of that information.

"We're keeping email addresses active throughout the day so everyone can say farewell," Zuckerberg said. Former employees will receive 16 weeks of base pay, plus two additional weeks for every year with the company, Zuckerberg said. Health insurance for those employees and their families will continue for six months.

Zuckerberg offers support to H-1B visa holders

As large-scale layoffs begin at Facebook's parent company Meta, employees on work visas such as H-1Bs are now faced with uncertainty over their immigration status, with Zuckerberg acknowledging "this is especially difficult if you're here on a visa" and offering support to those impacted.

"I know this is especially difficult if you're here on a visa. There's a notice period before termination and some visa grace periods, which means everyone will have time to make plans and work through their immigration status. We have dedicated immigration specialists to help guide you based on what you and your family need," he said.

What is H-1B Visa ?

The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise. Technology companies depend on it to hire tens of thousands of employees each year from countries like India and China.

H-1B visa holders can stay and work in the US for a period of three years, extended by another three years. They are then required to leave the country unless their employee sponsors them for permanent residency, known as the Green Card, the backlog for which runs into decades.

If H-1B visa holders lose their jobs, they only have a "grace period" of 60 days to find an employee willing to sponsor their H-1B, failing which they will be required to leave the US.

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