Meta Eyes 'Large-Scale' Layoffs This Week As Tech Industry Pays Price Of 'Overhiring'

Facebook's parent company Meta is reportedly looking to kick off a "large-scale" layoff round this week on the heels of massive layoffs at Twitter on Friday. Facebook is just among the increasing number of tech giants that appear to be reeling from the effects of overhiring during the pandemic.

Thousands of employees are expected to be affected by Meta's planned layoffs that could start as early as Wednesday, the Wall Street Journal reported, citing people with knowledge of the matter.

The sources told WSJ that company officials have already informed employees to put off non-essential trips starting this week.

Deemed as the biggest company reductions in Meta yet, the reported layoffs this week may also turn out to be the largest layoff round in the big tech industry this year, according to WSJ.

A Meta spokesperson declined to comment on the matter, the outlet reported.

During the tech company's third-quarter earnings call in late October, Meta CFO David Wehner stated that the company will be making "significant changes across the board to operate more efficiently," further explaining that the tech giant is "holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities."

"Realistically, there are probably a bunch of people at the company who shouldn't be here," Zuckerberg earlier said during a meeting with employees in late June, as per a recording of the meeting obtained and released by The Verge in July.

The Verge's Alex Heath tweeted at the time of the publication of the supposed June meeting that "it's clear Zuckerberg thinks the company over-hired."

At the end of 2019, Meta had about 48,000 employees, but by the end of December 2021, the numbers grew to 71,970 full-time workers, as per data from Statista. The additional hires accounted for a 62% increase in the number of employees.

If Meta over-hired people during the pandemic when online services were at a peak, it wouldn't be the only tech giant to have done so and ended up implementing or planning layoffs this year.

On Thursday, fintech company Stripe announced a 14% reduction in its workforce. Stripe CEO Patrick Collison told employees in a note shared with the public that the company "overhired for the world we're in."

Furthermore, ride-sharing company Lyft too implemented its second round of layoffs this year, cutting 13% of its staff or about 700 employees, as per a company email sent on Nov. 3.

In March last year, Lyft said it was the busiest time for the company since the pandemic as daily rider volumes were higher than in the same period in 2020.

Finally, Twitter under Elon Musk cut its workforce by about half on Friday, affecting thousands of employees. Musk said Saturday that Twitter had "no choice" but to implement the reductions as the company was losing $4 million per day.

The company is now reportedly asking some of its laid-off employees to return as some were removed "by mistake."

While Meta has not mentioned overhiring during the pandemic, Zuckerberg did announce plans of freezing hiring late in September. Even before the said announcement, the tech billionaire has alluded to a wide-scale shrinking of company budgets, signaling a similar pattern taken by companies that overhired when demand was relatively high.