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Monday, February 6, 2023

Anxiety Grows Among Google Employees as They Prepare for a Cost-Cutting Drive

This month, Google employees in Switzerland expressed their concerns to the company’s vice president of human resources in a letter. The letter focused on the potential use of a new employee rating system to lay off employees.

Some Google workers, as shown by the letter, see recent management moves as hints that the business is about to implement widespread layoffs. According to interviews with 14 current and former employees, who all spoke on the condition of anonymity for fear of retaliation, the Silicon Valley behemoth has become a tinderbox of anxiety due to the impending closure of a small office and the cancellation of a content-moderation project, as well as various efforts to ease budgets during 2023 planning meetings.

The effort to streamline processes, reduce bureaucracy, and increase productivity at Google was introduced in July and has already elicited some responses from staff members. The participants claimed that in other cases, teams have had financial discussions and realised they would be unable to add new members in the next year. They also indicated that employees have been worrying about choices that were made months ago but have taken on a fresh significance for them.

These concerns have increased as Google’s competitors in the technology sector have begun laying off workers in response to the weakening global economy. Meta, the company that owns Facebook and Instagram, laid off 11,000 people this month, or nearly 13% of its workforce. Aside from retail workers, Amazon has started laying off roughly 10,000 individuals in corporate and technology roles, or about 3 percent of its corporate workforce.

Even Google, which expects to rake in tens of billions of dollars in revenues this year, has forced to accept the reality of a slowdown. Alphabet, Google’s parent company, reported a 27 percent decline in earnings from the previous year’s third quarter to $13.9 billion in October as the digital advertising market fell.

When The Times asked Google for a comment on the stress levels of its employees, the company declined to do so. The CEO, Sundar Pichai, said in October that the firm will “concentrate on a defined set of product and commercial goals.” He also claimed recruiting will be slowed and cost increases would be “moderated.”

Google, in contrast to other significant tech corporations, has avoided widespread layoffs thus far. Mark Mahaney, an analyst at Evercore ISI, said that despite investors’ pressure, the corporation has gotten more active in “defending” its massive earnings.

He said that reducing the number of employees was a simple and effective approach to save money. Given the current economic climate, he said it was “sort of weird” that Google’s parent company had employed 30,000 people in the last three quarters. Alphabet has 186,779 employees as of the end of September.

A closer eye on expenses seems to have been adopted by Google in recent months. Its attempt to simplify operations began in July. A number of initiatives, including the Pixelbook laptop and the Stadia gaming streaming platform, were scrapped shortly after. Area 120, the company’s in-house product incubator, has also had its budget cut.

Someone familiar with the matter said on the condition of anonymity because the discussions were confidential and that Google had informed other workers that it would prioritise cutting real estate spending, travel costs, and perks before pursuing layoffs. The little office in Farmington Hills, Michigan, a suburb of Detroit, will be shut down by the corporation next month.

Four sources familiar with the matter have confirmed that in September, YouTube, a Google subsidiary, terminated a project that employed close to eighty individuals at its Farmington Hills headquarters, resulting in the layoff of some employees who were unable to find other positions inside the business. They were independent contractors recruited by YouTube to police the site for offensive or otherwise problematic uploads. Google has announced the layoff of 14 employees.

Google has said that it has no intention of reducing its workforce as a whole as a result of these reorganisations; nonetheless, certain teams may remove positions as a result of reevaluating their objectives.

Google said it was anticipating a gradual increase in system familiarity across staff members. There would be “no surprises,” the company said, so workers would be aware of any problems with their performance in advance.

Jonathan James
I serve as a Senior Executive Journalist of The National Era
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