Mark Zuckerberg recently talked about why tech companies are still laying off people, and it turns out it's not just about fixing past mistakes. Initially, layoffs happened because companies hired too many people during the e-commerce boom. But now, it's not just about fixing that. Companies are realizing that being smaller actually has some perks. The Meta CEO shared his thoughts in the recent episode of Morning Brew Daily's podcast, published on Friday.
Zuckerberg thinks that being leaner—having fewer people—can make a company work better. Even though letting go of talented folks was tough during the first round of layoffs, he believes that being more efficient is helping companies get back on track.
Meta, Zuckerberg's company, went through a major staff cut, and they're also getting rid of some management layers to be more efficient. For instance, Instagram is cutting technical program manager roles, and this is happening in other parts of Meta too.
So, to break it down, companies are choosing to be smaller on purpose, thinking it makes them work better, even after the challenging times of the pandemic.
In the podcast, Zuckerberg shared that companies are still focused on efficiency today. Many are exploring ways to restructure, streamline management levels, and shift towards a more efficient model.
Even with strong earnings, companies like Microsoft and Google continue downsizing. CEOs at firms like Amazon have expressed intentions to restructure and invest in AI-related areas. However, according to Zuckerberg, AI isn't the primary factor in these changes.
The Meta CEO clarified, "AI wasn't a significant factor for them in this. It began with excessive hiring and transformed into a dedication to excel by functioning as a more streamlined company."
