Meta's Project OT: Lessons from AI Missteps.

On May 19, 2026, Mark Zuckerberg cancelled Meta’s planned second wave of Project OT layoffs after the first wave cut roughly 8,000 jobs, following internal data showing AI agents drove activity without commensurate user value.

Under Project OT, Meta aimed to replace traditional roles with “Builder” pods supervising agents, while capturing employees’ keystrokes, clicks, and screenshots to train those agents; morale fell from 74% to 55%.

Telemetry showed internal code changes up 220% year over year while user-facing feature delivery rose only 36%, alongside a 40% rise in major incidents and up to 70% more cleanup time, illustrating Goodhart’s Law and the loss of tacit judgment and “refusal” described by Polanyi.

The disruption from layoffs may also explain incident growth, undermining claims of surplus labor. Twenty-six laid-off workers are suing over alleged AI-driven selection using activity data, potentially disadvantaging those on leave, and the broader pattern echoes other firms’ AI quality reversals while leaving Meta’s measurement incentives intact.