Google’s parent firm, Alphabet, announced Friday that it will be eliminating 12,000 positions, making it the latest technology giant to do so following a recruiting frenzy during the epidemic and amid worries about a larger economic slowdown.
The corporation is making its largest-ever job layoffs, which will affect around 6% of its global workforce. Alphabet’s CEO, Sundar Pichai, claimed that the firm expanded too quickly during the epidemic when demand for digital services soared and that it now needs to refocus on goods and technologies essential to the company’s future, such as artificial intelligence.
He stated: “While this transition won’t be easy, we’re going to support employees as they look for their next opportunity.
“Until then, please take good care of yourselves as you absorb this difficult news. As part of that, if you are starting your work day, please feel free to work from home today.”
Google employs more than 5,500 people in the UK, according to a recent Companies House report. How many of these will be impacted by the cuts is unknown.
For US employees, Mr Pichai offered severance packages that include at least 16 weeks of pay, their bonus from 2022, paid time off, and six months of health insurance.
Even on our most challenging days, he claimed, he was “optimistic about our ability to deliver our mission.”
The changes were well received on Wall Street as Alphabet shares increased by 3.5% in electronic trading before the market opened.
According to analysts, the top names in tech had already overspent and did not anticipate a slowdown.
Early in February, Alphabet is scheduled to release financial results for the three months that ended on December 30. According to Wall Street experts, the company’s sales will only increase by 1.7% from the same time last year. Compared to the 32% increase it experienced at the same time last year, that would indicate a dramatic decline. Analysts anticipate that net income will decrease by around 25% on a yearly basis.
Inflation is weighing on consumer spending, and rising loan rates are making finance more difficult. Google’s job cuts are only the most recent in a brutal wave of industry layoffs. As individuals transition back to their offline lifestyles, the demand for digital services during the epidemic has also decreased.