Hundreds of Snapchat employees will lose their this 2024, as confirmed by the social media platform's parent company, Snap Inc.
It is the latest tech firm that confirmed a mass layoff this 2024; joining other tech giants, such as Amazon, Google, Microsoft, TikTok, etc.
In this photo illustration, the Snapchat logo is displayed on a cell phone screen on February 03, 2022 in San Anselmo, California. Shares of Snapchat surged in after hours trading after the company reported a better-than-expected fourth quarter earnings.
Snap Inc. announced this business activity on Monday, Feb. 5, in its official U.S. Securities and Exchange Commission (SEC) filing. The American social media giant said that it will reduce its global full-time workforce by 10%.
But, what's the reason behind the latest Snapchat layoff? Here's what you need to know.
Snap To Reduce Hierarchy by Terminating Hundreds of Employees, But Why?
According to BBC News' latest report, Snap Inc. terminated 5,000 Snapchat employees back in 2023. Now, the latest mass layoff will affect 500 employees.
"In order to best position our business to execute on our highest priorities, and to ensure we have the capacity to invest incrementally to support our growth over time, we have made the difficult decision to restructure our team," said the social media giant via its official SEC filing.
The reason behind the mass layoff is to reduce the hierarchy within the company, as well as promote in-person collaborations between employees.
"We are reorganizing our team to reduce hierarchy and promote in-person collaboration. We are focused on supporting our departing team members," said a Snap Inc. spokesperson.
Snapchat's parent company already confirmed this plan back in 2023, saying that around 500 employees are facing redundancy in the company.
As of writing, Snap Inc. hasn't confirmed who will be terminated. It also didn't specify the exact date of the mass layoff since the terminations would be subject to local law and consultation requirements depending on the countries where employees are located.
Why Snapchat Wants To Reduce Hierarchy
The Snapchat app is displayed on the home screen of an iPhone on May 2, 2018 in San Anselmo, California. Stock prices for Snapchat dropped 20 percent before slightly rebounding after reporting first quarter earnings of $230.66 million on Tuesday that didn't meet analyst expectations of $243.6 million.
Snap Inc. didn't clarify why it wants to reduce its hierarchy. But, this business adjustment is actually beneficial.
Experts said that there are numerous reasons why many companies want to reduce their hierarchy, such as the following:
- Less hierarchy can motivate employees since they don't have to work for too many bosses.
- It could lead to continuous learning.
- Reducing hierarchy will allow the company to better use its employees' talents.
- There will be less office politics.
- Employees can have more flexibility.
- Less hierarchy can lead to better decision-making.
Related Article: Macy's Announces Store Closures, Mass Layoff as It Adapts To Small-Format Store Trend in Retail Industry
