Google layoffs

Alphabet (Google) to lay off 12,000 employees

Google to lay off 12,000 employees

Google parent company Alphabet announced Friday that it is cutting around 12,000 jobs, or 6% of its global workforce. The company stated that while the layoffs will occur in all regions and hit most units, they may affect teams such as recruiting more. Alphabet follows tech giants such as Microsoft (LinkedIn’s parent company), which announced layoffs earlier this week, as well as the likes of Meta and Amazon. Many Big Tech firms hired extensively during the pandemic to cope with enormous demand, and are now contending with an uncertain economic climate and record-high inflation.

Google is laying off 12,000 people, its largest layoff ever. Here’s what you need to know:

– Cutting 12,000 jobs is regrettable, but Google still remains far above its employee headcount ahead of the pandemic ramp-up. In March 2020 Google had 123,000 employees and by last quarter it was up to 186,000. This hurts, but it alone shouldn’t leave Google diminished. 

– That said, Google has a major challenge on its hands. It must effectively respond to the threat from ChatGPT and Microsoft’s OpenAI partnership. And it must do so as employees reel from the cuts. Google was probably the ‘safest’ of all the tech giants and that safety is gone now. Sundar Pichai will have to keep his employee base motivated while retaining his high performers and innovators. It won’t be easy.

– For that reason, I expect this to be the end of the cuts. Google needed to do this and it mulled it for months. Its profit dropped 27% last quarter, which is brutal. More rounds of cuts could send Google’s most crucial employees out the door, and that could be a serious problem for the company.

– In the short term, I see Google as a solid candidate for a rebound. As the economy improves, advertising can come back in a big way and search is one of the first places that advertisers will turn back on.


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