Google and Alphabet CEO Sundar Pichai announced via an update earlier today that they would be reducing the global workforce by around 12,000 employees, roughly 6% of its employees according to Reuters.
The layoffs, made public via the January update titled “A difficult decision to set us up for the future” makes reference to the past two years which saw a global pandemic and a period of rapid growth. “Over the past two years we’ve seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today.” The “different economic reality” that Pichai is referring to can be seen as the current global cost-of-living crisis, where multiple countries are either in, or about to enter a recession.
Pichai states that “we’ve undertaken a rigorous review across product areas and functions to ensure that our people and roles are aligned with our highest priorities as a company. The roles we’re eliminating reflect the outcome of that review. They cut across Alphabet, product areas, functions, levels and regions.” Who and what roles have been cut is not made clear in the update, those details will undoubtedly rise to the surface as many ex-Googlers use social media to announce their next steps. Reuters claims the job losses will be across recruiting, engineering and product teams but this has yet to be confirmed.
Employees based in the United States are set to receive 60 days pay, a severance package starting at 16 weeks salary, 2022 bonuses and vacation time paid and six months healthcare, job placement and immigration support. Employees based outside of the US will receive support in line with local legislation.
The tech sector is riding out a period of uncertainty. Just a few days ago Microsoft announced that it too was laying off around 10,000 (approximately 5% of the global workforce) employees, and investing in AI. At the beginning of 2023 Amazon announced that it was laying off over 18,000 (5%) of its workforce. It seems that no-one is immune to this economic situation.
More details around the support and how Google will move forward will be made clear at a town hall meeting on Monday 23 January.