The Google logo, in a company store in New York. ANDREW KELLY (Reuters)
Alphabet, the parent company of Google, will cut around 12,000 jobs worldwide, a figure close to 6% of the workforce, to address the weakening of economic conditions, as reported this Friday by the group's CEO, Sundar Pichai. , in a message to employees.
It is the largest workforce cut in its history and brings the number of layoffs announced by the big technology companies, Big Tech, to 51,000 in the last year.
The Mountain View giant (United States) joins the wave of massive layoffs in the US technology sector due to the worse conditions of the economy, the increase in costs and the strong increases in staff carried out during the pandemic, when the demand for their services skyrocketed.
Microsoft announced this week the cut of about 10,000 jobs and at the beginning of the year Amazon raised its layoffs to about 18,000 workers.
Last year, Meta announced a workforce cut of 11,000 people.
Of the big five, only Apple has so far escaped a massive downsizing, though it has slowed hiring and laid off some employees.
In addition to the so-called Big Tech, many other technology companies, including Salesforce, Twitter or Netflix, have also made layoffs.
According to the Layoffs.fyi website, which monitors layoffs in the technology sector, some 39,000 layoffs have already been announced in the first 20 days of this year, adding to the 155,000 in 2022. This, despite the fact that The US economy has the lowest unemployment figure in the last 50 years, at 3.5%.
"We have decided to reduce our workforce by approximately 12,000 positions," Pichai has communicated, in a message made public at dawn this Friday at Google's headquarters in Mountain View (California), after noon in mainland Spain.
Pichai said the company has already contacted affected employees in the United States by email, while in other countries, "this process will take longer due to local laws and practices."
In his message, entitled "A difficult decision to prepare for the future", the executive explained that in the last two years the multinational had undertaken a hiring policy "to match and feed" the spectacular growth experienced in that period.
"We hire for a different economic reality than the one we face today," he acknowledged.
In the last five years, Alphabet had more than doubled its workforce, from the 88,110 employees with which it closed 2017 to the 186,779 it had as of September 30, the last figure officially published by the company, and which may have increased in the last quarter. .
Since 2020 alone, the company had hired more than 50,000 people.
It is another common factor for all the big technology companies, which launched to hire in the midst of a pandemic when the confinement and the change in consumer habits reinforced the demand for their products and services.
Now, with the slowdown in the economy, they consider that their staff are oversized.
The profit of the Google group has fallen during 2022, but it continues to have multi-million dollar profits.
In the first nine months of the year, it billed 206,788 million dollars, 13% more than in the same period of 2021, but its benefits fell 16%, to 46,348 million, according to its accounts until September.
The drop in profit has been accelerating and was 27% if only the third quarter is considered.
The company will present its annual results on February 2.
The roles to be eliminated at Alphabet reflect the result of a rigorous review conducted across all areas and functions to ensure they are responsive to the company's top priorities and span the different product areas, functions, levels and regions of the group, according to Pichai.
The company will give its US employees severance pay of a minimum of 16 weeks of salary plus two weeks for each year of seniority with Google and will accelerate the award of shares and options considered as compensation by at least 16 weeks.
Alphabet will also pay laid-off employees 2022 bonuses and unused vacations, offer six months of health coverage, job search services, and support for processing the immigration status of foreign employees in the country.
Outside the United States, "local practices" will be followed, adds Pichai.
The chief executive of Alphabet assures that the cuts in some areas will allow the company to bet on others, among which it indicates artificial intelligence, for which the group bet early.
“A great opportunity lies ahead with artificial intelligence in all of our products, and we are prepared to approach it boldly and responsibly,” he says.
In Alphabet, the emergence of the ChatGPT bot, which Microsoft has opted for, has been seen as a great threat, as it is feared that users will replace many Internet searches with questions to the artificial intelligence bot.
