Google corporate parent Alphabet is laying off 12,000 workers, joining other technology companies reducing their workforces and increasingly cutting back on office space.
Several tech companies based in Seattle, San Francisco and California’s Silicon Valley, including Microsoft, Salesforce, Twitter and Facebook parent Meta, have responded in the past several weeks to declining consumer demand and drops in advertising revenue.
Most cuts in staffing and real estate have taken place in those companies’ corporate headquarters cities, but they have been carried out in locations worldwide. The moves come as the U.S. office market is already suffering from reduced demand after the pandemic accelerated the trend of working at home.
“Over the past two years we’ve seen periods of dramatic growth,” Alphabet CEO Sundar Pichai said in a statement posted Friday on the Mountain View, California-based owner of search engine provider Google said on its blog. “To match and fuel that growth, we hired for a different economic reality than the one we face today.”
Pichai did not reference real estate moves resulting from planned layoffs, but cuts could affect multiple departments and regions worldwide. Planned layoffs represent about 6% of Google’s total global workforce.
“We’ve undertaken a rigorous review across product areas and functions to ensure that our people and roles are aligned with our highest priorities as a company,” Pichai said. “The roles we’re eliminating reflect the outcome of that review. They cut across Alphabet product areas, functions, levels and regions.”
Technology Job Cuts
Technology companies announced 16,193 job cuts in December, bringing the industry’s total in 2022 to 97,171, according to outplacement firm Challenger, Gray & Christmas.
Technology was by far the largest generator of U.S. job cuts during 2022, rising 649% from the 12,975 reductions announced in 2021.
The Google move comes right after Microsoft, based in Redmond, Washington, said it will cut 10,000 jobs — nearly 5% of its workforce — by the end of September and consolidate real estate leases "to create higher density across our workspaces," according to a company filing.
Microsoft informed state officials Wednesday about the first round of cutbacks, with 878 employees permanently losing their jobs starting on March 20 across the company’s headquarters and facilities in Bellevue and Issaquah in greater Seattle, according to a Washington Worker Adjustment and Retraining Notification, also known as WARN.
The cuts by Microsoft, greater Seattle's second-largest office occupier, came less than two weeks after Amazon, the region's largest office user, said it will increase its planned layoffs to 18,000 from 10,000 as a result of the slowing economy and rapid hiring during the pandemic.
The layoffs add to mounting uncertainty across the technology industry as big companies either freeze hiring, walk back remote work policies or cancel plans to expand their real estate portfolios from Silicon Valley and Seattle to New York in the face of a sudden slowdown after the pandemic growth spurt.