BREAKING

Google cuts 12,000 jobs amid nationwide tech layoffs

By Al Mayadeen English
Source: Agencies
21 Jan 2023 09:04

Although the share of layoffs is relatively small (6%), 12,000 is still a large number of people that will be left unemployed.

Google's Bay View campus in Mountain View, California. (David Paul Morris for Bloomberg via Getty Images)

In light of a nationwide slew of tech layoffs in recent months, Google's parent company announced on Friday that is cutting 12,000 jobs.

Although the share of layoffs is relatively small (6%), 12,000 is still a large number of people that will be left unemployed. The reason for doing so is owed to the changing economic reality, according to an email written by CEO Sundar Pichai to his employees.

This comes a day after Microsoft announced plans to cut 10,000 jobs in the near future, like Facebook, Meta, and Twitter who did likewise recently.

Most tech companies argue that they hired at a massive pace during the pandemic as a means of meeting the global demand for goods and services.

"Over the past two years we've seen periods of dramatic growth," Alphabet CEO Sundar Pichai said in an email to employees.

"To match and fuel that growth, we hired for a different economic reality than the one we face today."

Pichai said that the company has launched a review "to ensure that our people and roles are aligned with our highest priorities as a company." The cuts will be "across departments, functions, levels of responsibility and regions," Pichai added.

"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."

Alphabet reports meager increase

In October of last year, it was reported that the digital-advertising industry has shown signs of fragility, as search company Google reported its fifth consecutive quarter of slow sales growth.

Youtube, which figures among one of Google's core properties, has also indicated a drop in advertising revenues this quarter.

Google's parent company, Alphabet Inc., racked up $69.1 billion in the third quarter last year, which highlights a meager increase of 6.1% compared to the same period the year prior.

Although Google remained relatively shielded from the privacy changes that Apple Inc. introduced in 2021, the wider economic cutback prompted Pichai to look for alternative ways to better the company’s bottom line after a sudden increase in revenues during the pandemic triggered a period of headlong expansion.

The CEO said in July 2022 that Google would slow hiring until the end of this year, and in September he said the company should become 20% more productive, without adding further details.

In November 2022, Google agreed to pay $392 million and settle a landmark privacy case with 40 US states over accusations that the search engine giant misled users into believing location tracking had been switched off on their devices.

A statement highlighted that it was the largest multi-state privacy settlement by state authorities in US history and included a binding commitment for improved disclosures by Google.

"Digital platforms like Google cannot claim to provide privacy controls to users then turn around and disregard those controls to collect and sell data to advertisers against users' express wishes -- and at great profit," stressed New Jersey Attorney General, Matthew Platkin, in the statement.

The rare joint lawsuit by 40 states grew from impatience over the failure of federal authorities to take strong action against big tech amid legislative gridlock in Washington.

Republican and Democratic lawmakers disagree on what national rules on online privacy should look like, with furious lobbying by tech companies to limit their potential impact.