Google to axe 12,000 jobs; CEO Sundar Pichai says company hired for a different economic reality

• Google parent Alphabet said that it will lay off 12,000 employees globally.
  
• While Google announced a severance package for those impacted in the US, those outside will be supported ‘in line with local practices’.
  
• “Over the past two years we’ve seen periods of dramatic growth, and we hired for a different economic reality than the one we face today,” says Pichai in his mail to employees.
  

Google’s parent Alphabet has said that it will be laying off 12,000 employees across functions, levels, product areas and regions. The company’s CEO Sundar Pichai conveyed the decision in an email sent to employees on Friday.

“This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here,” Pichai said in an email which was subsequently posted on the official Google blog.

Google joins the growing list of big tech companies that are cutting jobs. The others include Microsoft, Meta, Amazon and Twitter, all of whom have slashed thousands of jobs in the last few weeks. According to Layoffs.fyi, a layoff tracker, 133 tech companies around the world have announced 38,815 job cuts around the world in 2023 alone.

In 2022, this number was much higher as 1,030 companies cut 1,54,843 jobs.

Pichai outlined an assistance plan for the impacted employees, including a severance package and healthcare benefits for six months after being laid off. However, this support plan is only applicable to US employees.

“Outside the US, we’ll support employees in line with local practices,” Pichai said.

In a response to Business Insider India, Google India said that there are no specific inputs about how many jobs in India will be impacted, or what their support plan will be.

Earlier today, foodtech startup Swiggy laid off 380 employees as a slowdown in its food delivery business forced the company to right-size.

‘We’re bound to go through difficult economic cycles’

Reflecting on the challenging macroeconomic conditions around the world, Pichai said, “As an almost 25-year-old company, we’re bound to go through difficult economic cycles.”

Since 2020, the year of Covid-19, Google’s headcount surged rapidly from 1,18,899 employees at the end of 2019, to 1,56,500 at the end of 2021 – that is an increase of 37,601 employees, or 31.6% in just two years.

“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,” Pichai said, acknowledging the rapid headcount expansion, and the economic uncertainties of today.

Pichai added that more specifics of the layoffs and the way forward will be discussed in a town hall on Monday. “Until then, please take good care of yourselves as you absorb this difficult news. As part of that, if you are just starting your work day, please feel free to work from home today,” he said.

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