San Francisco During an address to the workforce, Facebook founder Mark Zuckerberg announced an austerity program with job cuts, according to matching media reports. “I had hoped that the economy had stabilized more significantly by now. But from what we see, that doesn’t seem to be the case yet, so we want to plan something conservative,“ the news agency quoted Bloomberg as saying from the meeting.
The Handelsblatt learned from corporate circles that the Facebook group Meta has stopped new hires. A response from the company was initially pending.
Since the founding of Facebook in 2004, the company had continuously built up staff. Since 2019 alone, more than 10,000 additional jobs have been created every year. Meta had more than 83,500 employees as of June 30, 2022. In the second quarter of this year alone, 5,700 employees were added.
Now a new time seems to be beginning for the company. “In the first 18 years of the company’s existence, we have grown rapidly practically every year. Recently, for the first time, our earnings have stagnated or slightly decreased,“ Zuckerberg said, according to Bloomberg. The company will be “a little smaller” in 2023.
For Europe alone, Meta announced the creation of 10,000 new jobs at the end of last year. It remained unclear at first how many of these positions have been filled so far and whether they could also be affected by cuts.
On the stock exchange, the share price declined after the news of an upcoming staff reduction was announced and meanwhile stood more than three percent in the red. Since the beginning of the year, Meta has lost more than 60 percent of its stock market value and was at its lowest level since the beginning of 2019.
Meta pays $292,785 in median salary
Analyst Brian Nowak of Morgan Stanley bank predicted a scenario in which Meta could save costs of the order of three to eight billion dollars in the 2023 financial year. He wrote out $225 per share as a price target. On Thursday, the stock was trading at around $136.
The Meta Group is one of the employers in Silicon Valley that pays the highest remuneration. A law in the USA – Dodd-Frank Act – obliges large, listed companies to disclose the average value of company remuneration. It was $292,785 for Meta in fiscal year 2021.
By comparison, the median reported by Google in 2021 was $295,884. The value of Twitter was $ 232,626. The value of the chip company Nvidia was $ 217,542.
Despite a more difficult market environment, Meta is highly profitable. For the past quarter, the company reported a net profit of $ 6.7 billion on revenue of $ 29 billion. However, the second quarter of the previous year was much better. At that time, with a turnover of about $ 29 billion, net profit was $ 10.3 billion.
42,000 Employees Laid off in the US technology sector
Over the past few months, a number of technology companies in Silicon Valley had announced layoffs, including well-known companies such as the streaming service Netflix, the broker Robin Hood or the contract specialist DocuSign. In the US technology sector, more than 42,000 jobs have been cut since the beginning of the year, according to surveys by the industry service Crunchbase.
Nevertheless, the technology sector still seems to be characterized by a shortage of skilled workers. The job broker Hirect launched a program in May to help laid-off specialists in a targeted manner in the search for a new job. It often takes only a few days to get a new job offer, the platform said.
In addition, unemployment in the United States is low. In many areas, there are problems finding staff at all. The unemployment rate was 3.7 percent in August, according to the U.S. Labor Department. According to the ministry, the number of unemployed increased by 344,000 to 6.0 million.