Meta, formerly known as Facebook, is expected to lay off thousands of employees starting later this week.
"You know, I'm not surprised to a certain point," San Jose State University Engineering professor and tech expert Ahmed Banafa said, adding these layoffs highlight a growing economic issue, especially in California.
He says these job cuts come at a time in which inflation is causing issues for companies like Meta, Twitter and others.
Many increased hiring this year with the expectation of a big boom in the economy after COVID. Unfortunately, Banafa says that did not happen and now, layoffs.
"I mean, it's across the board in the tech industry," Banafa said. "All the consumers and all the other dimensions of the tech industry are suffering from this because of that hiring."
However, Banafa says Meta has some issues specific to them as well.
Specifically, stiff competition from TikTok, loss of advertising money due to Facebook tracking concerns and the large investment put into the Metaverse.
"It's very hard to look at a company and see that they are really going in the wrong direction until we see the symptoms, which is what we are seeing now," Banafa said. "There is something seriously going on with the company when they are laying off thousands of employees."
So what impacts may we feel in the Bay Area? Banafa says it may not be all bad news.
He expects many of the thousands could be hired for in-person jobs, restimulating the economy and keeping people from moving out of the Bay Area while working from home.
Also, many companies outside the tech sector could hire these employees to share their expertise as everyone grows into a new age of doing business.
"We should not undermine the ability of Silicon Valley of generating more ideas, more companies - we just cleared the pipeline," Banafa said. "We're going to have a new wave of ideas, inventions and technologies."
Unfortunately, he says tech layoffs are expected to continue and results on Election Day will provide greater insight on the future of the industry.
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