Alphabet, Google’s parent company, will reduce 12,000 jobs in the latest round of staff cuts in the tech sector.
Sundar Pichai, Alphabet CEO and Google founder, stated that he accepted “full responsibility” in an internal email.
The reductions will impact 6% of Alphabet’s workforce worldwide in teams that include recruitment, engineering, and engineering.
This announcement comes just days after Microsoft said 10,000 jobs would be eliminated and weeks after Amazon made 18,000 job cuts.
Staff were thanked by Mr Pichai for their hard work and added that their contributions have been “invaluable”.
He wrote, “While this transition will not be easy, but we’re going support employees as they search for their next opportunity.”
“Please take care of yourself while you are processing this hard news. If you’re just beginning your workday, feel free to work remotely today.
A recent Companies House filing shows that Google employs more than 5,500 people in the UK. It is not clear how many of these employees will be affected by the cuts.
‘Unsustainable’
The US employee will be eligible for severance packages from Mr. Pichai, which include at least 16 weeks salary, their 2022 bonus and paid vacations. They also receive six months of coverage.
He stated that he was “optimistic about our capability to deliver on the mission, even on the most difficult days”.
Wall Street was happy with the reductions – Alphabet shares increased by 3.5% in electronic trade before the stock exchange opened.
Analysts believe that tech’s top guns have overspent in the past and are not expecting a slowdown.
Daniel Ives, of Wedbush Securities, said that the layoffs are a sign of irresponsible spending in a sector that is experiencing “hypergrowth”.
He stated that tech stalwarts had over-hired at an unsustainable pace, which is now causing layoffs in the tech sector.
Layoffs.fyi reports that nearly 194,000 workers in the US have lost their jobs since 2022. This does not include those announced by Alphabet Friday.
Hewlett Packard, and Salesforce, the cloud computing giant, announced significant cuts this month. Rising interest rates and rampant inflation have slowed down growth.
The European Union has begun to investigate US tech giants. They are being investigated for evading tax, suppressing competition, profiting off news content without payment, and spreading hateful information.