In Silicon Valley, job cuts are notable after the largest companies hired at breakneck speed during the pandemic.
For several months, Facebook has faced slow growth and increased competition. Goal, the mother house, seeks to reduce its expenses by at least 10% and for this reason it has begun to reduce its staff, without giving the proportion, by reorganizing its services. In practice, the company is giving affected employees a limited time to apply for other positions within the company, according to current executives interviewed by the Wall Street Journal who researched this. Failing to find another position internally, it will be the door.
These budget cuts should be the prelude to bigger cuts, predict people interviewed by the American newspaper. While some savings will come from overhead cost reductions, a large portion of them should come from downsizing. The word layoff has never been uttered internally, with the terms “hiring freeze” and “priorities” being preferred. These practices would not be new to Meta.
Same practice on Google
Google also needs to take cost-cutting steps. The company has also asked some employees to apply for new jobs at Google if they want to stay with the company.
This is the case of the startup incubator Area 120, which belongs to Alphabet, the parent company of Google. Last week, the group warned half of the more than 100 employees that they would have to find another job with the company within 90 days.
Google generally gives employees 60 days to apply for other positions within the company if their job has been laid off.
Difficult context for the GAFAM
In May 2021, Facebook App Manager Tom Allison wrote a memo titled “Why is it so hard to hire right now?” He laments a “huge supply-demand imbalance between our hiring needs and the availability of talent.”
Meta’s share price has lost more than 56.6% since the beginning of 2022, and the company’s market value has fallen by more than $685 billion.
At Google, the share price has also fallen 27.3% over the past year. In July, Sundar Pichai, chief executive of Alphabet, said Google would cut hiring for the rest of the year and urged employees to be “more entrepreneurial.” He warned that he wanted the company to be 20% more productive.
For its part, Snapchat has publicly announced layoffs. Last week, the company said it would cut around 20% of its staff after increasing its workforce by around 65% from the end of 2020.
Source: BFM TV