Meta has reportedly paused hiring for artificial intelligence (AI) professionals following a massive recruitment drive.
The freeze went into effect last week and is happening amid a wider restructuring of the AI division, the Wall Street Journal (WSJ) reported late Wednesday (Aug. 20), citing sources familiar with the matter. The length of the freeze was not clear, the report added.
The news comes at the tail end of a summer that began with reports that Meta CEO Mark Zuckerberg had personally gotten involved in the company’s AI hiring efforts, offering – in some cases – nine-figure compensation packages.
According to the WSJ, a spokesperson for Meta confirmed the pause in hiring, calling it “basic organizational planning: creating a solid structure for our new superintelligence efforts after bringing people on board and undertaking yearly budgeting and planning exercises.”
This week also saw reports that Meta was dividing its AI unit into four groups, marking the fourth such restructuring in six months.
As the WSJ notes, increasing concerns about the cost of Big Tech’s AI projects has helped drive a recent selloff of technology stocks.
That trend was fueled in part by an MIT study which found that most organizations – 95% – were getting “zero return” on their investments into AI. And Sam Altman, CEO of OpenAI, had given an interview recently in which he warned of an AI bubble (while still expressing his confidence in the future of the technology).
In a research note earlier this week, analysts at Morgan Stanley warned that the compensation packages offered by Meta and Google to attract AI talent could threaten their ability to return capital to investors in the form of buybacks.
Big spending on hiring, the analysts wrote, “has the potential to drive AI breakthroughs with massive value creation or could dilute shareholder value without any clear innovation gains.”
Meanwhile, OpenAI Chief Financial Officer Sarah Friar said this week that the AI boom was just getting underway, adding that the industry is “voracious” for GPUs and compute.
“The biggest thing we face is being constantly under compute,” Friar said in an interview with CNBC. “That’s why we launched Stargate, that’s why we’re doing the bigger builds that you see with Microsoft, Oracle, CoreWeave and so on. And we are just getting started.”
Stargate is the data center project OpenAI launched in conjunction with SoftBank and Oracle, initially conceived as a $500 billion effort. However, last month saw reports that the project was off to a slow start, shifting its goal from investing $100 billion immediately to constructing one data center by the end of the year.
Source: https://www.pymnts.com/
