It is now Google’s turn to announce a major wave of layoffs. In an email to company employees, its CEO, Sundar Pichai, regrets ” say goodbye to some incredibly talented people we’ve struggled to hire and enjoyed working with “.
Post-Covid hurts tech giants financially
Inflation, European economy shaken by high energy costs and the war in Ukraine, supply disruptions in Asia, investor fears… The tech sector is hit hard by a multifactorial crisis which pushes its actors, even the most important ones, to completely review their roadmap after a period of exponential growth during the pandemic.
This is particularly the case of Google, which is experiencing a period of less well after having recorded record results for several quarters. In the third fiscal year of 2022, running from June to August, the Mountain View firm, for example, saw its profits fall by 27% compared to the same period of the previous year.
Sundar Pichai already expecting difficulties in July, when he announced difficult times as well as a slowdown in hiring. He then decided to freeze recruitment for a period of two weeks, but that was not enough.
6% of Google workforce affected
” I have some difficult news to share. We have decided to reduce our workforce by approximately 12,000 positions he wrote in an email, later published as a blog post. This represents 6% of Google’s global workforce. ” Over the past two years, we have experienced periods of spectacular growth. To support and fuel this growth, we hired for an economic reality different from the one we know today “, continues the CEO.
On the divisions affected by these decisions, he explains: “ We have undertaken rigorous review across all areas and functions to ensure our people and roles are aligned with our highest priorities as a business. The roles we are eliminating reflect the results of this review. They are divided between Alphabet, product areas, functions, levels and regions “.
In the US, terminated Google staff will be entitled to 16 weeks of severance pay, plus two weeks for each additional year with Google, and six months of health care. They will also benefit from their remaining 2022 bonuses and vacations. Sundar Pichai clarified that employees terminated outside the United States will have support in accordance with local laws.
Google wants to focus on artificial intelligence
Google is therefore added to the substantial list of tech giants who have decided to lay off massively. While Amazon said it was laying off 18,000 people, or 6% of its workforce, Meta laid off 13% of its workforce, or 11,000 employees. Microsoft is also expected to make a similar announcement very soon.
Sundar Pichai also reaffirmed Google’s ambition to focus more on artificial intelligence. While its takeover of DeepMind in 2014 enabled it to make significant progress in this area, the significant breakthroughs of OpenAI with ChatGPT, and its close link with its rival Microsoft, worry the Mountain View firm who seems to want to go into overdrive so as not to be left behind.