A series of layoffs in the big tech and other online majors have set off shockwaves across the digital world – the latest to join the firing bandwagon being micro-blogging site Twitter, Meta, which owns popular social networking sites Facebook and Instagram, eCommerce giant Amazon and IT major Microsoft.
The firings also raise a question mark over the digital economy that witness an unprecedented boom during the Covid pandemic but now seems to be wavering across the world.
On 9 November 2022, Meta CEO Mark Zuckerberg, in an email to its staff, announced that he had decided to let go 11,000 employees or 13% of the workforce across departments. The social media behemoth is grappling with rising costs and a shaky advertising market.
“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go. We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.
“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 wrote.
The Meta CEO said the surge of eCommerce during the pandemic led to outsized revenue growth, which many thought would accelerate permanently even later on and invested heavily in digital. This, unfortunately, did not happen and the macroeconomic downturn and other factors caused revenue to be much lower than expected, forcing him to take the extreme decision, he said.
Meta, as Zuckerberg said, has shifted resources to what he called “high priority” growth areas such as the AI discovery engine, ads and business platforms, and his long-term vision for the metaverse.
Zuckerberg said he cut costs across business, including scaling back budgets, reducing perks, and shrinking their real estate footprint but these measures would not bring its expenses in line with its revenue growth.
The move has drawn criticism with many saying that Zuckerberg had chosen metaverse over its employees.
As per media reports, out of the estimated 1,000 employees in India, up to 100 have been affected, the majority of whom are tech workers including software engineers. Various media reports highlighted the stories of Indians abroad who have received the pink slip, including that of a man who relocated to Canada just two days before he was fired.
Twitter, on the other hand, started layoffs after the world’s richest man, Elon Musk, took over – just before the Meta firings. The micro-blogging site is said to have slashed at least half of its 3,700 workforce – including its CEO Parag Agarwal, CFO Ned Segal and legal affairs, and policy chief Vijaya Gadde – in the first round.
The second round at Twitter came after the Meta firings when Musk reportedly sacked thousands of contractual workers, affecting around 4,400 out of 5,500 people though there was no confirmation from the company yet.
Platformer’s Casey Newton tweeted, “Update: company sources tell me that yesterday Twitter eliminated ~4,400 of its ~5,500 contract employees, with cuts expected to have significant impact to content moderation and the core infrastructure services that keep the site up and running. People inside are stunned.”
Various reports said Twitter laid off 180 of 230 employees in India, sacking the whole marketing and communications departments. Twitter’s India offices are located in New Delhi, Mumbai and the southern tech hub of Bengaluru. The social media giant has been at loggerheads with India over social media accountability and the government’s tighter norms.
Musk has been reported as saying he had no choice because the social network was losing more than US$ 4 million per day. Musk also tweeted that Twitter spends US$ 13 million every year on its food service at its headquarters or between US$ 20 and US$ 25 a day per person. A New York Times article stated that the Tesla boss had revoked free lunches from Twitter employees.
Twitter co-founder and former CEO Jack Dorsey said sorry. “I own the responsibility for why everyone is in this situation,” he said.
Another big layoff is in the pipeline from Amazon, which plans to fire approximately 10,000 people in corporate and technology jobs any time, in what would be the largest job cuts in the company’s history, the New York Times reported. The retrenchments will cut across Amazon’s devices organization, including Alexa, and its retail and human resources divisions.
The layoffs would comprise roughly 3% of Amazon’s corporate employees and less than 1% of its global workforce of more than 1.5 million, which is primarily composed of hourly workers, NYT reported. Amazon had already slowed down its hiring process.
Apart from these three, many other big names have either decided to lay off people or cut down on spending, media reports said.
Walt Disney: Walt Disney has decided to stop hiring and fire staff as it strives to revive the Disney+ service amid economic uncertainty, Reuters reported
Snap: Snap, which runs Snapchat, laid off around 20% of its 6,400-strong workforce in August this year, reports said.
Microsoft: IT Major Microsoft fired nearly 1,000 employees at many levels, across the world, various media reports said.
Intel: Intel also plans to lay off thousands of employees in the sales and marketing sections, Bloomberg reported.
Apple: Predicting that growth will slow down during the holiday period, Apple has stopped hiring for many jobs outside of research and development, Bloomberg said.