Facebook’s parent company Meta has announced it is implementing a hiring freeze “for most roles across the company” and will “minimise costs”, as the social media group continues to battle an advertising slump and rising competition.
In an internal memo seen by the Financial Times, Lori Goler, Meta’s head of people, wrote to staff that, starting on Friday, the company would “pause sourcing candidates and will not make any offers until the freeze is lifted later this year”.
She said that while some teams will still grow, each one will individually have to decide how to prioritise projects and restructure in order to “ensure we can deliver against our top priorities” during the belt-tightening efforts. Internal transfers will also be frozen, she said.
“Our 2023 budget is going to be very tight across all teams as we try to minimise costs,” Goler wrote.
Boom times for social media groups during the pandemic have turned this year into a deep and broad stock sell-off as tough macroeconomic conditions have prompted advertisers, Meta’s main source of revenue, to curb their spending. Meanwhile, the group has faced rising competition from popular short form video app TikTok, which is owned by China’s ByteDance.
In July, chief executive Mark Zuckerberg announced he planned to “steadily reduce headcount growth over the next year” and that he would delegate downsizing decisions to individual team leaders.
Since the third quarter of last year, the company has also brought down its guidance for full-year costs in 2022 — from $91bn-$97bn to $85bn-$88bn at its latest second-quarter earnings.
The company has been trying to balance developing its short-form video product, Reels, in order to boost the popularity of its social platforms Facebook and Instagram — together with its efforts to build an entirely new digital avatar-filled virtual world called the metaverse.
“Each org leader is working through their exact plans for next year, but it’s important to pause recruiting and not bring new people into teams while they do this work,” Goler wrote on Thursday. “Providing this stability will make sure we don’t put people into roles that may change or disappear.”
Shortly before Goler’s memo was posted in Meta’s internal messaging board, Zuckerberg outlined the plans to staffers during an all-hands meeting, according to Bloomberg.
Meta declined to comment.