Meta And Google Are Cutting Staff. Don’t Mention Layoffs.

Platforms Inc. executives have spoken of cost cuts, hiring freezes and “ruthless prioritization.” One word the company didn’t use: layoffs.

But Meta has begun to quietly push a significant number of staff members by reorganizing departments and giving affected employees a limited window to apply for other positions within the company, according to current and former managers familiar with the matter. , in a move that allows staff to be reduced while preventing the massive issuance of pink slips.

The cuts should be a prelude to deeper cuts, with Meta looking to cut costs by at least 10% over the next few months, according to people briefed on the company’s plans. While some savings will come from reductions in overhead and consulting budgets, the people said, much of that is expected to come from reduced employment.

In response to questions, Meta spokeswoman Tracy Clayton referred to the general manager

Mark ZuckerbergEast

July statement that the company should reallocate resources to business priorities as pressures escalate on the business.

Big Tech’s Staff Reshuffles

“We have spoken publicly about the need for our teams to change to meet these challenges,” Mr. Clayton said. He said giving laid-off employees a period to apply for new jobs is one way to retain talent that Meta might otherwise lose. He declined to say how many employees were affected by the recent moves.

The company has cut its operating expense guidance since the third quarter of last year, but has not yet suggested it will cut staff by means other than natural attrition.

Among some Meta employees, the process of re-applying for jobs within a limited window internally is known as a kind of HR purgatory they call the “30-day list”.

Meta, since last year the name of Facebook’s parent company, has long had a practice that employees whose roles are eliminated are subject to termination if they cannot find a new job internally in a period of one month. Many other companies are also trying to reassign employees whose groups are closed or restructured. At Meta historically, only employees deemed undesirable failed to land new positions. Now affected employees and managers say workers with good reputations and strong performance reviews are routinely kicked out.

Meta said it had 83,553 employees at the end of the second quarter, up 32% from a year earlier.

As part of its own cost reduction measures,

Alphabet Inc.

GOOG 0.56%

Google has also asked some employees to apply for new jobs if they want to stay with the company. Last week, Google told about half of more than 100 employees at the company’s startup incubator, Area 120, that they should find other jobs at the company within 90 days, said people familiar with the decision.

Google generally gives employees 60 days to apply for other positions at the company if their jobs have been cut, although employees in Area 120 generally receive more time if their plans are cancelled, people familiar with said. the process.

In March, more than 1,400 Google employees signed a petition demanding that the company extend the typical 60-day period to 180 days for a group of more than 100 employees in the cloud computing division, citing “transfer barriers many workers face”.

In the first quarter of 2022, the productivity of American workers fell in the biggest decline in 74 years. The WSJ’s Jon Hilsenrath explains why productivity is at the heart of the economy and why it can be difficult to recover from steep declines. Illustration: Reshad Malekzai

A Google spokesperson said nearly 95% of employees who expressed an interest in staying with the company found new roles within the notice period. Alphabet had 174,014 employees at the end of the second quarter, up 20.8% from a year earlier.

In Silicon Valley, downsizing is notable after the biggest companies hired at breakneck speed during the pandemic. In May 2021, Facebook app manager Tom Allison wrote a memo titled “Why is hiring so hard right now?” Mr. Allison lamented a “major supply and demand imbalance between our hiring needs and the availability of talent.” With the sharper engineers shortage, the company was hiring more recruiters, he wrote, but even those were hard to come by.

With the economic climate cooling and the digital advertising market turbulent, the language of some prominent tech executives is now markedly different.

“Realistically, there’s probably a bunch of people in the company who shouldn’t be here,” Zuckerberg said at a company town hall meeting in June. Separately, the company’s head of engineering appealed to managers. to identify employees who were coasting and place them on remediation plans as a prelude to their termination.

The abrupt wording of the memo led to considerable mockery and angst in internal company forums, according to posts seen by The Wall Street Journal.

Meta’s share price has fallen more than 56.6% so far in 2022, and the company’s market value has fallen more than $685 billion since its peak in September 2021 at the close on Tuesday. .

Google has been more resilient, but the search giant’s share price has also fallen 27.3% over the past year. In July, the managing director of Alphabet

Sundar Pichai

said Google would slow hiring for the rest of the year and urged employees to be “more enterprising”. Mr Pichai told a conference earlier this month that he wanted the company to become 20% more productive, without providing details on how he would measure the improvement.

To break Inc.

is one of the outliers in the public announcement of layoffs. The company said last week it would cut around 20% of its staff after increasing its workforce by around 65% since the end of 2020.

“We need to reduce our cost structure to avoid incurring large ongoing losses,” the chief executive said.

Evan Spiegel

in a memo to staff. He said the company is launching an opt-in talent directory to help departing employees find work outside the company.

Silicon Valley continues to be a competitive talent market, so finding ways to relocate employees within a company can yield benefits, said Allison Rutledge-Parisi, senior vice president of human resources at Justworks, a professional employee services company.

“It would be ridiculous for a company to summarily get rid of a group of people that it knows, with whom it has managed, with whom it has a relationship, who has contributed, without thinking about a methodology that would find them another place. and another focus within the organization,” she said.

There are also potential downsides to employees vying for a limited number of internal positions, including hits to productivity and morale, said Dave Fisch, general manager of career site Ladders. “There’s going to be a lot of chatter, there could be a lot of animosity and finger pointing that naturally starts to arise,” Fisch said.

At Meta, the agitation to be rehired is well underway.

“I’m a fast learner who’s up for a challenge and evidently by this post, someone who isn’t afraid to put themselves forward,” a Meta data scientist wrote on an internal forum last month, in which she stated that she was looking for a new position. “You miss 100% of the shots you don’t take and I would kick myself if I ended up leaving without exploring every possible avenue. »

Write to Jeff Horwitz at jeff.horwitz@wsj.com, Salvador Rodriguez at salvador.rodriguez@wsj.com and Miles Kruppa at miles.kruppa@wsj.com

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