Google’s parent company Alphabet is set to lay off around 12,000 employees with immediate effect.
Update: Sundar Pichai has now confirmed Google’s plans to “reduce” the workforce by “approximately 12,000 roles” in a dedicated January update post on the Keyword Blog. This update confirms the previously reported information but also expands upon how Google will handle employee layoffs and the reasoning behind this.
Those affected have been contacted and will be paid for the full notification period, which is a minimum of 60 days. A severance package has also been offered, which starts at 16 weeks’ salary plus two weeks of salary for every additional year an employee has worked at Google.
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All 2022 bonuses and remaining vacation time are also set to be paid, while six months of healthcare will also be provided for US-based staff. Immigration support is also set to be offered alongside job placement services information.
Pichai cites “difficult economic cycles” for these cuts with a new focus on directing “talent and capital” to Google’s “highest priorities.” One of these is directly mentioned; AI is certainly a big focus for Google in the coming years having acquired and invested heavily in recent years.
According to an internal staff memo seen by Reuters, Alphabet CEO Sundar Pichai confirmed that the firm is set to cut around 12,000 jobs across various sectors and business areas. This move comes shortly after Microsoft announced similar layoffs, but Google is set to lay off employees in selected regions such as the US with immediate effect per this report. This reportedly represents up to 6% of the entire company.
It is said that lay offs will come from areas including recruitment, corporate teams, and will also include various engineering and product sectors within Google. The memo is also said to note that US staff will be impacted immediately, with global layoffs also in the pipeline. Local employment laws will be applicable to those across the globe which could slow down this process.
In the memo, Sundar Pichai highlighted Google’s “investments in AI” and the “value” of the firm’s “products and services.” Pichai also told employees that the company had tried to “rationalize where we can” to ensure that Google is “better weather the storm regardless of what’s ahead.” Affected employees have already been emailed or contacted per this original report.
“I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI.”
Additional reporting from the Wall Street Journal says that Alphabet has confirmed that any U.S.-based employees affected by lay offs will be given two months’ notice, plus 16 weeks of severance pay, along with two additional weeks for each year the employee was at the company.
What isn’t clear is what areas Google will trim the most. The recent shuttering of cloud-gaming service Stadia could see staffing numbers included within these figures. A few high-profile staff behind the service —such as Phil Harrison — are still listed with the tech giant. However, this is expected to change over the coming months with Google likely to confirm employee lay offs across various sectors.
A Google spokesperson told the WSJ that these cuts will also affect other Alphabet subsidiaries but did not confirm just what levels will be targeted. Alphabet has a number of subsidiaries that include Waymo, Verily, and more.
Google’s Q3 earnings report saw revenues jump 6% in Q3 2022, but this was lower than initial estimates. This was the weakest period of growth for the company since 2013 which saw profits dip almost 30% year-over-year to $17.35 billion for Q3 2022.
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