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Meta employees want to cut jobs in the face of the stock market crash

Shares in Facebook and Instagram parent Meta have plunged more than 40% over the past six months — and some employees saddled with underwater stock options are eyeing the exits.

“Nearby at Meta [all time stock high], now I feel like s—t,” said a Meta contributor this week in a popular thread on Blind, a corporate forum with verified members. “What should I do?”

“Get out of this shit place,” replied another “Metamate.”

“Same boat,” said a third, adding that they were “already interviewing” at other companies.

“Duh, you should think about Meta, Metamates and me. Ask yourself if that line of thinking is good for the company,” jokes a fourth. “Just kidding… it sucks.”

Meta is facing a worker rush as its stock price fell to $216.49 on Friday from an all-time high of more than $380 in September. The slide began last fall when a devastating series of leaks put massive political pressure on the company and kicked into high gear as Meta began to feel the billions of dollars in privacy changes from Apple and Google that were wreaking havoc on its advertising business.

“People are definitely paying attention and worried about the stock price,” Michael Solomon, who runs software engineers through his talent firm 10x Management, told The Post. “I think a lot of people have questions about whether meta is going to come out of this — whether this could be the beginning of the end for them.”

Meta
Meta’s stock is down more than 40% after hitting an all-time high in September 2021.
REUTERS

“To go in your interest”

When software developers join companies like Meta, Google, or Amazon, their compensation is typically a roughly 50/50 mix of cash and stock options, with newcomers getting more cash and more experienced employees getting more stock, according to data from tech salary tracker level .fyi.

At Meta, new hires typically receive a set number of restricted stock units based on the company’s average stock price at the time of their hire. That means there can be tremendous benefits for employees who jump in before a company’s stock soars — but it also leaves them vulnerable to downturns.

For example, a Meta employee who was given $100,000 in restricted stock units around the company’s stock high in September would now have about $57,000 left over.

It also means opportunists from other companies — like Microsoft, which is down 10.3% so far this year — can theoretically “buy the dip” by taking a job at a troubled company like Meta and getting more stock options at one get lower price price.

tech worker
Many tech workers have seen the value of their stock options fall.
Getty Images/iStockphoto

In response to an angry Metamate post on Blind, a Microsoft employee wrote: “The only people who would be okay are those who are transferring businesses right now. I’m doing exactly that and making my way to Meta.”

Laura Martin, tech and media analyst at Needham & Company, said that while many tech workers feel loyal to their companies, it makes financial sense for many to switch jobs when the value of their options is declining.

“If you don’t make money from your stock options for three years, it’s in your best interest to leave,” Martin told the Post. “I agree with the decision to leave your current company and go to a company and purchase shares at their current price.”

Meta
“I think a lot of people have questions about meta getting out there — whether this could be the beginning of the end for them,” said tech talent agent Michael Solomon.
Getty Images

“Significantly higher cash compensation”

While Meta is the most extreme example, the entire tech sector has plummeted this year after hitting record highs in 2021. The tech-heavy Nasdaq Composite Index is down 12.3% so far in 2022, while Apple stock is down 9.9%, Amazon stock is down 5.3%, and Google stock is down 5.7%.

With stock options generally falling in value, big tech companies are now realizing that cash is king, according to Richard Kramer, technology analyst and founder of Arete Research.

“The big tech companies just pay far more cash compensation because the top 5 have over $345 billion combined in net cash,” Kramer told The Post. “The battle for top talent has not abated.”

Compensation often comes in the form of “cash retention incentives,” which are paid out based on employees staying a certain number of years with the company, according to Brian Kropp, head of human resources research at consulting firm Gartner.

Google
Google stock also fell in 2022.
Getty Images

“As your stock price falls, the effectiveness of restricted stock units as a retention strategy diminishes,” Kropp told The Post.

And some engineers looking for cash rather than stock options have been able to negotiate massive payouts from Meta in recent months, according to Talent Agent Solomon.

“They get better deals because Meta knows they have to compensate,” Solomon said.

Meta didn’t respond to questions about measures it’s taking to retain and attract talent.

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Some smaller tech companies have been hit even harder than Meta.
Getty Images

“Stocks Much More Than Meta”

While companies like Meta and Amazon have been hit in 2022, some of the smaller tech companies that have boomed during the pandemic have felt even more pain as the Federal Reserve hikes interest rates and investors divest from tech stocks.

Netflix, which has been booming during lockdown, is down 33.9% this year. Video conferencing company Zoom’s stock has fallen to just $116.28 from an all-time high of $310 in September. And Robinhood, the stock trading app that capitalized on the “meme stocks” boom of 2020 and 2021, traded as high as $70 shortly after its IPO last summer, but has since traded at less than $13.50 like.

The list goes on, with employees at PayPal, e-commerce firm Shopify, struggling fitness company Peloton, and electric car maker Rivian all complaining about the slump in their companies’ stocks over the past few months.

“Joined Rivian in January and am over 50% loss,” wrote a Rivian employee, accompanied by a “facepalm” emoji.

The shakeout at underperforming tech companies could help Meta and other big tech companies recruit talent and at least partially offset departures related to stock slumps, Kramer said.

“They recruit from hundreds of other enterprise software companies, etc., whose stocks have gone down a lot more than Meta,” he said.

Kramer added that the biggest tech companies don’t actively poach each other’s employees because that would be a “prescription for wage inflation.”

However, that doesn’t stop employees from one big tech company from applying to another.

https://nypost.com/2022/03/20/meta-employees-look-to-ditch-jobs-amid-stock-crash/ Meta employees want to cut jobs in the face of the stock market crash

DUSTIN JONES

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