The technology titan, Alphabet Inc.’s Google GOOGL GOOG, is making headlines with its decision to lay off hundreds of employees from its hardware and digital assistant teams. This move is part of a broad cost-cutting initiative within the company.
What Happened: The layoffs chiefly affected employees associated with the voice-based Google Assistant and the augmented reality hardware team. The central engineering organization of the company also experienced cuts. This decision comes as Google’s primary search business faces growing competition from AI offerings of rivals Microsoft Corp MSFT and OpenAI’s ChatGPT, according to a Bloomberg report on Thursday.
Google executives had previously voiced potential cuts during investor calls, aiming to allocate resources towards priority investments. A Google spokesperson stated that their teams are making changes to work more efficiently and better align resources with their most significant product priorities, which will include some global role eliminations.
"Throughout the second half of 2023, a number of our teams made changes to become more efficient and work better, and to align their resources to their biggest product priorities," a Google spokesperson said.
"Some teams are continuing to make these kinds of organizational changes, which include some role eliminations globally."
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The Alphabet Workers Union has voiced criticism over the layoffs, pledging to persist in their fight for job security. The Union further emphasized that the company cannot continue to dismiss hardworking employees while earning billions every quarter.
The recent layoffs follow a significant downsizing last year, where Alphabet announced a cut of approximately 12,000 jobs, over 6% of its global workforce. The company has continued to make smaller cuts throughout 2023, in areas such as recruiting, news products, and the Waze mapping app.
Why It Matters: The large-scale layoffs at Google follow a trend observed in the tech sector, where several companies announced significant layoffs over the past year. However, some companies have begun to adopt a new approach of reassigning employees to different roles instead of laying them off in an attempt to retain top talent.
Google has opted for further cuts following a series of cost-saving measures, including optimizing its infrastructure and reducing non-essential perks.
This came after Meta Platforms Inc.'s Instagram also discontinued the role of technical program managers. The move requires affected employees to reinterview for alternate roles, with the risk of being terminated by March if they fail to secure a new position.
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