TORONTO 鈥� A number of 91原创 workers have been laid off by Meta Inc. as the tech giant announced plans to cut 13 per cent of its workforce in a bid to become "leaner and more efficient."
91原创 staff in the company's communications, creative partnerships, client relations and human resources departments all posted about their layoffs on LinkedIn on Wednesday.
"I have no idea what's next, but it was a gift of four years I'm grateful for and thanks to so many of you for being a part of it," wrote Neil Mohan, a creative partnerships lead in Toronto, in a LinkedIn post announcing his layoff alongside the broader 91原创 team he worked on.
Meta spokesperson Alex Kucharski would not say how many 91原创s were impacted by the cuts, but directed The 91原创 Press to a public letter from founder and CEO Mark Zuckerberg, which said a total of about 11,000 workers would be departing.
The cuts are the product of a miscalculation on the growth of e-commerce, which Zuckerberg thought would be permanent but has been falling from its pandemic highs, he said in the letter.
Seeing the initial surge and others making similar predictions, he made the decision to significantly increase Meta's investments.
"Unfortunately, this did not play out the way I expected," Zuckerberg wrote.
"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鈥檇 expected.聽
"I got this wrong, and I take responsibility for that."
His note came after months of spending cuts and layoffs across the global tech sector triggered by waning investor exuberance and a rethink of valuations that soared during the pandemic.
"The tech sector is readjusting to a new economic reality," said Courtney Radsch, a senior fellow at the Centre for International Governance Innovation, a think tank focused on technology and international governance.
Part of the readjustment includes cuts at Netflix, Microsoft, Oracle and Intel along with dozens of international startups and household names.聽
91原创 companies Shopify Inc, Clearco, Hootsuite and Wealthsimple have made layoffs too.
Zuckerberg's letter mirrored Shopify chief executive Tobi Lutke's July missive announcing 10 per cent of staff 鈥� roughly 1,000 workers 鈥� would be departing the Ottawa-based e-commerce company.
Like Zuckerberg, Lutke said the pandemic created a surge in demand for Shopify鈥檚 software as consumers shifted to making a higher number of purchases online.
鈥淲e couldn鈥檛 know for sure at the time, but we knew that if there was a chance that this was true, we would have to expand the company to match,鈥� Lutke said at the time.
鈥淚t鈥檚 now clear that bet didn鈥檛 pay off.鈥�
The similarities in approaches tech leaders have taken and the size of the cuts they have made should "be a wake-up call for regulators," said Radsch.
"As long as major platforms with a lot of staff and really high valuations are owned or essentially controlled by billionaires, who are insulated from a lot of types of pressures that non-millionaires are not isolated from, we're going to continue to see (these cuts)," she said.
Meta's Class B shares carry a higher weight than its Class A shares, and Zuckerberg owns the majority of the Class B shares.聽
"Mark (Zuckerberg) has a level of power over the company that's pretty unusual for this type of company ... and for one person to decide the fate of 11,000 people 鈥� not to mention political, social, economic features of much of the world that depends on Facebook advertising and infrastructure 鈥� I think it's really problematic," said Radsch.
While she doesn't think the workers laid off by Meta will have trouble finding employment, many won't be paid Meta-level salaries and will face greater competition in the job market.
Many companies will have their eye on workers from Meta, which can be hard for startups to lure in because they don't have the big budgets tech giants do.
"People who come from these large tech employers are highly skilled, have great resumes and there are lots of other tech communities eager to get top talent," said Jenna Jacobson, an associate professor at Toronto Metropolitan University's Ted Rogers School of Management.
But the cuts will also weigh on future hiring.
Meta, for example, said it will freeze hiring for its first quarter.
The company had announced plans to hire more than 2,500 office and remote workers to its 91原创 contingent over the next five years and situate many of them in a Toronto engineering hub. The company was also due to leave behind its MaRS Discovery District office for a new home at an undisclosed location.
Asked whether those plans will be reduced or cancelled, Kucharski said, "Our expansion in Canada was always a long term one planned over a number of years."聽
"We remain committed to Canada and look forward to many years of innovation ahead in Toronto."
This report by The 91原创 Press was first published Nov. 9, 2022.
Tara Deschamps, The 91原创 Press
