The Industry

The Biggest Threat to Facebook Isn’t Congress. It’s Employee Morale.

Facebook employees work at its new London offices, designed by Frank Gehry.
Facebook employees work at its new London offices, designed by Frank Gehry. DANIEL LEAL-OLIVAS/Getty Images

There are 535 people in Congress with the power to constrain Facebook’s business, should CEO Mark Zuckerberg fail to persuade them this week that his company can be trusted to regulate its own behavior. But there’s another, much larger audience that Zuckerberg will be trying to appeal to at the same time: his own 25,000-plus employees, and the tens of thousands more whom the company might hope to recruit and retain in the future.

From the start, a key to Facebook’s success has been its ability to attract, motivate, and inspire some of the world’s most talented engineers, designers, product managers, and business minds. It’s commonly understood within Silicon Valley that tech companies’ success depends in large part on winning the war for top coding talent, in particular. Lavish salaries, benefits, and perks are part of the equation, but they aren’t enough when you’re competing against the likes of Apple, Google, and countless startups. You also have to convince employees and potential hires that you’re working on something big, important, and world-changing—preferably in a good way.

While Facebook has always faced some mistrust from the media and the public, it has maintained a reputation inside the tech world as one of those “mission-driven” companies where your work can influence society for the better. Facebook’s recruiting slogan in job ads reflects that: “Best place to build and make an impact.” If tech workers start to see Facebook’s impact on the world in a negative light, some might stay (or take jobs there) for the money, but the most coveted employees will go elsewhere in search of both money and a sense of meaning. And even those who stay are unlikely to voluntarily pour their late nights and passion into their work for the company.

A poor performance from Zuckerberg on Capitol Hill might irk lawmakers enough to ramp up their efforts to regulate the company in various ways—perhaps with new rules regarding advertising transparency or data protection. But from a Congress that just last year struck down Obama-era privacy rules restricting internet service providers, the sort of sweeping legislation that would really cripple Facebook’s business is nowhere in sight.

A backlash on the part of Facebook users is unlikely to pose a real threat to the company’s future either: It’s already too big a part of most people’s lives for them to give up on it. Zuckerberg said last week that the #DeleteFacebook campaign has had no meaningful impact on the social network’s active user base.

On the other hand, if Zuckerberg sweats through Congress’ questions and delivers evasive, unconvincing, or embarrassing answers, the effect on employee recruitment and retention could be significant.

The Wall Street Journal reported Tuesday that many Facebook employees are so far standing by their company: They view the Cambridge Analytica scandal as overblown and think the media is making Facebook a scapegoat. That’s good news for Facebook’s future, provided the company can sustain that sense of pride and common purpose.

Then again, Facebook’s existing employees have plenty of incentive to downplay concerns about the company’s image. The ones Facebook will be trying to hire for years to come have no such vested interest in defending it. And in fact, the Journal reports:

There are some signs the crisis is having an effect on luring talent: Since the disclosures, more candidates for jobs in some units at Facebook have withdrawn from consideration than during any other period in memory, according to a person familiar with the company’s recruiting.

The story also notes that a small number of employees have left the company, citing moral objections to its impact on society and politics. And several early Facebook employees, including investors Sean Parker and Chamath Palihapitiya, have recently denounced it publicly—a sign that it isn’t just the East Coast media bubble that has grown disenchanted with the company.

In other words, some damage to Facebook’s reputation has already been done. So while Zuckerberg this week will be speaking directly to members of Senate and House committees, he’ll also be indirectly addressing the concerns of Facebook users, employees, and skilled coders around the world. And his ability to control the damage on those fronts might be the most critical of all.

Read more from Slate on Cambridge Analytica.