Google is cutting 12,000 employees, becoming the latest tech company to cut its workforce.
The wave of mass job creation in the tech industry began last fall, when slower revenue growth is expected as the economy shrinks.
The nearly 25-year-old tech giant will offer employees 16 weeks of pay, plus two weeks for each additional year at Alphabet’s subsidiary GOOGL. The cuts began on January 20.
The severance package also includes paying six months of health insurance, job placement services and immigration support for those affected, plus bonuses for 2022 and remaining vacation time. Google is also speeding up at least 16 weeks of GSU vesting. GSUs are certificates representing shares of Alphabet.
The jobs cut were spread across the search and cloud company, including Alphabet, product areas, functions, tiers and regions, Sundar Pichai, Google’s CEO, wrote in an email.
He said Google will offer severance payments to employees in other countries “in line with local practices”.
Technology companies continue to reduce their workforce in an effort to cut costs as the economy slows, offering various severance packages to their employees.
Microsoft (MSFT) – Get a free reportthe Redmond, Washington, software giant founded by Bill Gates, laid off 10,000 employees or 5% of its workforce on Jan. 18.
While most tech companies seem to offer more than adequate severance packages, including salaries and health benefits for several months, employees at Google and Meta Platforms (META) – Get a free report received the most generous offer of at least four months’ paid salary.
Amazon (AMZN) – Get a free report he was rumored to have been offered three months’ salary. Microsoft did not mention the length of the severance payments, saying only that it would provide “above-market severance payments,” CEO Satya Nadella said in a filing with the U.S. Securities and Exchange Commission.
Microsoft also offers health care coverage for six months, continued share awards for six months, and 60 days’ notice prior to termination, “regardless of whether such notice is required by law,” he said. “Benefits for employees outside the US will be in accordance with labor laws in each country.”
The company said it also took a $1.2 billion charge related to layoff costs, changes to its hardware portfolio and the cost of rent consolidation of its offices in the fiscal second quarter.
“These decisions are difficult, but necessary,” Nadella said. “We are doing everything we can to ensure that all those whose roles are eliminated receive our full support during these transitions.”
A difficult time for technology
On Jan. 4, Nadella said the tech industry needs to be prepared for the next two years to be challenging. He said it would run into more roadblocks before recovering.
“I would say the next two years are probably going to be the most challenging because after all, we’ve had a lot of acceleration during the pandemic, and there’s a certain amount of normalization of that demand,” Nadella said. UKTN.
Revenue growth is expected to slow, prompting other tech companies like Meta Platforms to cut 11,000 jobs, a first since the social networking giant launched in 2004. E-commerce giant Amazon said it would cut more than 18,000 jobs.
a Platforms, the owner of Facebook, Instagram and WhatsApp, laid off 13% of its staff in November.
The social media company gives its staff the most severance pay by offering 16 weeks of salary, plus two additional weeks for each year of service without setting a limit.
Meta CEO Mark Zuckerberg explained the generous severance pay for employees in a blog post. The company pays for all paid time off (PTO) and everyone who is part of the Restricted Stock Units (RSU) program received their awards on November 15.
Meta will continue to pay for six months of health insurance for both employees and their dependents, plus three months of career support with a third-party provider, including “early access to unpublished job opportunities,” the company said.
The company is also known for hiring employees who work in the US because they have company-sponsored visas. The tech giant also provided immigration specialists to provide guidance.
“I know this is especially hard when you’re here on a visa,” Zuckerberg said. “There is a notice period for termination and some grace periods for visas, which means everyone has time to make plans and process their immigration status.”
The layoffs at Amazon continue
Amazon continued its layoffs on January 18, totaling 18,000, the largest number in its history.
Employees in some divisions were offered “voluntary severance payments” last November when the layoffs initially began, according to UKTN.
Those workers received severance pay of three months’ wages, plus one week’s salary for every six months of service with the company, the report said.
Amazon employees also received a weekly stipend for 12 weeks that could be used towards COBRA premium payments after their health insurance ended on Dec. 31.
Twitter’s new CEO Elon Musk had said he would offer three months’ pay for layoffs, but some employees have said they’ve only received one month so far, plus two months of non-working pay in line with the Worker Adjustment and Retraining Notification, or ALERT, act.
The WARN Act requires employers to give 60 days’ notice of layoffs occurring company-wide.
A judge ruled that a class action lawsuit from several employees seeking increased pay should instead seek redress in private arbitration over the employment contract signed with Twitter.