By: Stuart White 30-01-2023
Earlier this week tech giant Google announced that it was laying off 12,000 workers, or about 6 per cent of its workforce, becoming the latest such company to trim staff as the economic boom that the industry rode during the COVID-19 pandemic peters out. Alphabet CEO Sundar Pichai, the parent company of Google, informed staff at the Silicon Valley giant about the cuts in an email that was also posted on the company’s news blog.
“Over the past two years we’ve seen periods of dramatic growth,” Pichai wrote. “To match and fuel that growth, we hired for a different economic reality than the one we face today…The layoffs reflect a “rigorous review” carried out by Google of its operations. The jobs being eliminated “cut across Alphabet, product areas, functions, levels and regions,” Pichai went on, saying he was “deeply sorry” for the layoffs.
Pichai further said that Google, founded around a quarter of a century ago, was “bound to go through difficult economic cycles…These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities,” he wrote. There will be job cuts in the U.S. and in other unspecified countries, according to Pichai’s letter.
Google took on a large number of additional staff during the Pandemic, owing to the increase in online activity as companies all round the world shifted their working practices to remote and online as staff were forced to work from home. Regulatory filings indicate that Google’s workforce swelled from 119,000 at the end of 2019 to 187,000 people by late last year. However the cuts were clearly unexpected; one fired employee described how she frantically emailed her boss before she was frozen out of the internal system to see what was going on, only to find that her manager was in exactly the same boat.
Several other tech companies also expanded for the same reason and are now facing the same issue of over-staffing. Just this week, Microsoft announced 10,000 job cuts, or nearly 5 per cent of its workforce. Amazon said this month its cutting 18,000 jobs, although that’s a fraction of its 1.5 million strong workforce, while business software maker Salesforce is laying off about 8,000 employees, or 10 per cent of the total. Last fall Facebook parent Meta announced it would shed 11,000 positions or 13 per cent of its workers and Elon Musk infamously made brutal redundancies at Twitter after acquiring the social media giant last year.
The tech industry has been forced to freeze hiring and cut jobs ‘as the clock has struck midnight on hyper growth and digital advertising headwinds are on the horizon,’ Wedbush Securities analysts Dan Ives, Taz Koujalgi and John Katsingris wrote Friday. ‘The stage is being set: tech names across the board are cutting costs to preserve margins and get leaner in the current economic climate’.
This month alone, there have been around 48,000 job cuts announced by major companies in the sector which must have remaining staff in a state of nervous tension, wondering if they might be next out of the door.
If you’re fortunate enough to have never having happened to you, it’s hard to imagine the devastation redundancy causes. First off is the loss of self-esteem; even though most, if not all, of the current layoffs were probably not based on lack of incompetence or insufficient productivity but more likely most simply have been decided on the ‘last in, first out’ principle, that won’t matter to the victims; they will be carrying round a feeling of depressive inadequacy and loss of self-worth. On top of that, there is the very real worry of keeping a roof over their heads and putting food on their and their families’ plates. Some countries, such as the UK, have generous social welfare grants but in the US, the allowance is basic and short-lived. In this instance Pichai has promised a generous severance package of a 16-week base payout plus an additional two weeks of pay for every year they spent with Google so they will be okay for 4 months but after that comes issue no. 3 which is trying to find alternative employment in a sector which is laying off, rather than taking on and in which your skill set exists; and fourth, though this is closely allied to point 1, there is the social humiliation of having to admit to family and friends that you have been ‘let go’. Whatever euphemistic term with which you describe it, it amounts to the same thing – you’re out of a job.
I’m reminded of the very funny 2013 movie titled ‘The Internship’ in which two salesmen, played by Vince Vaughn and Owen Wilson, their own careers torpedoed by the digital era, decide to apply for internships with Google, a company no doubt delighted to show off their many employee benefits and new-age working environment, not to mention the accompanying advertising, for the organisation in the movie. Once there they find themselves up against competing tech-savvy Gen-Zedders, two fish most definitely out of water. If you haven’t already seen it – and you definitely should – I won’t give the ending away but a fresh view would now have to be tempered with the codicil of ‘how times change’. Today, a sequel would probably have to have the title of ‘The Externship’, where incumbents vie to try and retain their place in the company!
But here’s the ultimate irony. As those footloose former staffers seek alternative positions, you know the first thing they’ll all be doing - turning to the search engine formerly known as ‘their employer’ and typing in a job search. Google fired them and now Google will have to help to re-hire them – poetic justice!