We’ve always associated Google with skyrocketing growth and super fun perks. Money has never been a concern for the global tech giant employing more than 174,000 people. There have always been benefits beyond reason at Google – it has always been a work hard, party harder environment. But things have changed in the past couple of quarters.
The US economy has faltered its way down to the lowest point since the last recession. Inflation is higher than ever, business is bad, and ad spend has plummeted. Now, ad spending is the main source of revenue for Google. It’s obvious that they are having a rough time.
Although Google has massive cash reserves and stupendous profit margins, it’s growth has dropped to single-digit numbers in the last two quarters from the 40% growth rate last year. In view of the slow-moving growth and the overall situation of the market Google CEO Sundar Pichai is forced to make some alterations to the perks and benefits as well as the company culture.
Answering an employee’s question during Google’s all-hands TGIF meeting (Thank God It’s Friday) about why Google is nickel & diming the employees, Pichai said, “Look, I hope all of you are reading the news, externally. The fact that you know, we are being a bit more responsible through one of the toughest macroeconomic conditions underway in the past decade, I think it’s important that as a company, we pull together to get through moments like this.”
This means that the travel allowances and entertainment bonuses will go down drastically for Google employees. Travel expenses will be limited to business-critical. The swag bonus will be cut down as well.
Google parent, Alphabet has decided to pull back the new Pixel laptop as well as the Area 120 project. Not only will we see less hiring, but also some layoffs. The company is currently concerned about its survival through a probable recession. They organized an employee survey to solicit ideas for becoming more productive by using fewer resources. The teams are being asked to do with 4 people what they’d under normal circumstances have hired 6 people for.
The strategic and cultural changes are not well received by the Google employees and they are raising questions and Pichai is in a tough spot at the moment.