Reddit to Lay Off About 5% of Its Workforce

Social news aggregator and discussion site Reddit said on Tuesday it is laying off about 5% of its workforce, or 90 employees. It joins a list of technology companies cutting jobs across corporate America as the industry braces for an economic downturn.

Several tech companies have cut jobs after aggressively hiring during the pandemic, as they are struggling to turn around declining advertising revenue. Those cuts have been compounded by the slowdown in economic growth that has weighed on the ad market and sparked fears of a global recession.

The layoffs at Meta are expected to affect non-engineering roles, including those related to content design and user experience research. After the last batch of layoffs, executives speaking at a company town hall in April said they would continue to restructure business teams to balance engineering and other roles better.

According to an email from Chief Executive Steve Huffman to employees, Meta has also been scaling back hiring. The company is lowering its target for new hires this year to 100 people, down from an earlier target of 300, according to the Wall Street Journal, which first reported the plans.

The company said the layoffs and refocusing of the company’s priorities are intended to help Reddit break even next year. It also aims to free up more resources for moderators to monitor content on the platform, notorious for trolling and bullying.

It’s still being determined how the layoffs will impact the website’s user base, but it could lead to a drop in the number of visitors to the site, which has more than 1.6 million users. On Wednesday, the company’s shares closed up in a weaker stock market.

Meta’s decision to restructure its business units comes after months of declining revenue growth caused by the economic slowdown and higher inflation that has cut digital advertising spending. The company is also facing a contraction in its e-commerce business as more shoppers move toward buying goods on Amazon (AMZN.O).

The company also poured billions of dollars into its metaverse-oriented Reality Labs unit, which lost $13.7 billion in 2022, and a project to support artificial intelligence work. Those costs have come at the expense of other initiatives, such as its international expansion and investments in its core business. Last month, Meta slashed jobs across its business and operations units as it carried out the final batch of layoffs. That reduced the number of employees at the company to about 8,000 from just over 10,000 in March. The cuts were part of a plan to shrink the company by about 10% over three “moments” that began in March and will be completed this May. The company expects to make smaller rounds of cuts after that.

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