Twitter Shuts Down Internal Communication Channels For Employees

Information that Facebook's parent company, Meta, was laying off an additional 11,000 employees surfaced late last week. A further 11,000 people were reportedly laidoff by Meta in the fall of 2022.

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Around the nation, hundreds of thousands of tech professionals have lost their jobs in the last year. Due to the lack of digital companies there, Rhode Island has not experienced much change.

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According to three persons with knowledge of the situation, Twitter let off at least 200 of its employees on Saturday night, or around 10% of the approximately 2,000 people who were still employed by the firm, The New York Times reported on Sunday. In an effort to save costs, Elon Musk, who bought the social networking site in October, has gradually reduced its headcount of approximately 7,500 employees.

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"Twitter employees were unable to communicate with each other for a week before the layoffs, according to Twitter. Employees were prevented from chatting with one another or looking up company data after the company's internal messaging service, Slack, was taken offline, according to five current and former employees. Several of these people said they found themselves logged out of their corporate email and laptop accounts, the first sign of layoffs, according to Trade Algo.

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Are Cuts Engaging in Copies? Do They Reward?

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According to Insider, Jeffrey Pfeffer, the Thomas D. Dee II Professor of Organizational Behavior at the Stanford Graduate School of Management, "Layoffs frequently don't raise stock prices or reduce costs. Layoffs have extremely ugly and detrimental effects on the organization, including the expense of severance and the loss of productivity. It's unclear whether they genuinely boost earnings.

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"The irony is that these same corporations were talking a year ago about people as their most important asset, and now they're treating their employees quite terribly, firing them off by email or by abruptly turning off their connection to the organization.," he adds.

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According to Trade Algo, it is unclear from the statistics if layoffs affect stock performance. "Some businesses discovered that larger layoffs elicited a more favorable response from shareholders. After announcing layoffs in early January, Coinbase was rewarded with a gain of roughly 13%. On learning that it would be laying off 10% of its workers later in the same month, online furnishings retailer Wayfair W -2.35% (W) saw a more than 20% increase in stock, according to Trade Algo.

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Yet, heavier cuts did not always result in a greater rise. Twilio announced earlier this month that it would reduce its staff by 17%, although the day's share price only increased by 2%. That can be a clue that being exhausted from layoffs dulls the response. According to Trade Algo, Twilio announced its second significant round of layoffs in a matter of months.