The CEO of Google parent Alphabet, Sundar Pichai, informed employees via email on January 20 that the company plans to eliminate 12,000 jobs, or 6% of its global workforce, as tech layoffs intensifies across companies.
Pichai added that he takes “full responsibility for the decisions that led us here,” adding that the cuts will effect employees globally and across the entire company.
Pichai continued, “These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities.”
Teams from across the organisation, including recruiting, some corporate functions, some engineering, and product teams, are impacted by the job losses.
According to Google, the layoffs are global and immediately affect US employees.
With the layoffs, Google joins a plethora of other tech giants that have significantly reduced operations in the face of a failing global economy and surging inflation. Twitter, Amazon.com, Microsoft, Meta Platforms, and Twitter have all reduced workforce.
Pichai stated that the tech giant will “support employees as they look for their next opportunity” in the announcement.
Pichai said the company will pay workers for the entire notice period in the US (minimum 60 days).
Along with accelerating at least 16 weeks of GSU vesting, Google will also provide a severance compensation that starts at 16 weeks of salary plus two extra weeks for each consecutive year of employment.
For those impacted, the company will pay incentives for 2022 and any unused vacation time, as well as provide 6 months of healthcare, job placement assistance, and immigration support.
Additionally, outside of the US, the search engine giant will support staff in accordance with local practices.
As part of the transition to a new performance management system, Google is delaying a chunk of its employees’ year-end incentives, according to a recent Reuters report.
According to a corporate spokesperson who talked to Reuters, the company will initially pay eligible employees an advance bonus of 80% and the remaining amount will follow in later months. The move was announced to the personnel last year.
The company, however, posted earnings and revenue in October that fell short of analyst expectations. Compared to the prior year, profit dropped by 27% to $13.9 billion.
At that time, Pichai said that Google will cut costs, and Ruth Porat, the chief financial officer, predicted that the number of new positions would decrease by more than half from the third quarter to the fourth.