Zuma Global President Heather Zumarraga responded to a recent report indicating that tech companies have cut 32,500 jobs in 2024 on ‘The Big Money Show.’
Meta CEO Mark Zuckerberg refuted the notion that the layoffs in the tech industry were a result of the advancement of artificial intelligence. According to Zuckerberg, the layoffs were initially triggered by the challenges posed by the e-commerce surge during the COVID-19 pandemic. Companies are now recognizing the benefits of operating as a more streamlined organization, as highlighted in his discussion on the Morning Brew Daily podcast.
Addressing Meta specifically, Zuckerberg emphasized that artificial intelligence was not a significant factor contributing to the layoffs.
The surge in e-commerce activity during the pandemic caught many companies off guard, leading to what Zuckerberg described as an “overbuilt” situation. Meta, among others, announced significant layoffs in November 2022, letting go of over 11,000 employees to streamline operations following substantial e-commerce investments. This was followed by another 10,000 job cuts last spring.
Despite Meta’s actions, several other prominent tech companies, including Alphabet, Amazon, and Microsoft, also resorted to layoffs over the past year, citing over-hiring as a key issue.
Zuckerberg explained that many companies across various sectors had over-extended themselves financially, leading to a realization that they needed to downsize. This trend resulted in a wave of layoffs as companies adjusted to their new financial realities.
Furthermore, Zuckerberg noted a shift in mindset among companies that had previously only experienced growth. Forced to downsize, these companies discovered increased efficiency as leaner organizations. This experience prompted a reevaluation of operational structures to optimize effectiveness.
The data reflects a significant increase in planned job cuts in January 2024, with companies announcing 82,307 layoffs—a 136% surge from the previous month. This figure represents the second-highest January layoff total since 2009, impacting employees across various sectors, including technology, media, and finance.
