Google executives will scale back a number of the technology firm’s notoriously lavish employee perks amid efforts to reduce costs and increase profitability.
Google CEO Sundar Pichai informed the company earlier this year that some 12,000 positions would be eliminated due to persistent macroeconomic turmoil. A memo sent by Google CFO Ruth Porat on Friday and obtained by Business Insider likewise said that the “challenging economic environment” and “incredible investment opportunities to drive technology forward” would necessitate changes to the company’s cost structure.
The workforce reductions will therefore precede the restructuring of technology operations for greater maximization of resources, as well as reforms to external procurement and contracting processes. Even as such changes will not “be visible” to most employees, the “industry-leading perks, benefits and office amenities” at Google will be scaled back to reduce expenses.
“Cafes, MicroKitchens and other facilities will be tailored to better match how and when they are being used. Decisions will be based on data,” the memo said. “For example, where a cafe is seeing a significantly lower volume of use on certain days, we’ll close it on those days and put more focus instead on popular options that are close by. Similarly, we’ll consolidate MicroKitchens in buildings where we’re seeing more waste than value.”
The cost reductions will also apply to “some fitness classes and shuttle schedules” based on the extent to which they are used. Equipment and technology utilized by employees will also be assessed, permitting Google to “save meaningfully” given the size of the firm.
The memo comes after at least 31 massage therapists and 21 members of the trust and safety department were dismissed as part of the layoffs, according to disclosures the firm made with the California Worker Adjustment and Retraining Notification system obtained by The Daily Wire. One employee with the title of “Diversity Manager” and another with the title of “Diversity Specialist” were also listed in the disclosures; the latter position earned annual compensation ranging between $90,000 and $148,000, according to an estimate from Glassdoor.
“Just as we did in 2008, we’ll be looking at data to identify other areas of spending that aren’t as effective as they should be, or that don’t scale at our size,” the memo added. “We will let Googlers know of any other changes that directly impact services they use.”
Most prominent technology companies started to reduce headcount as the elevated consumer demand which followed the lockdown-induced recession began to slow. More than 130,000 workers have been dismissed from technology firms so far in 2023, according to a report from Crunchbase, even after companies nixed about 93,000 positions last year.
Twitter CEO Elon Musk has also implemented reforms to the amenities and perks offered by the social media company. The firm auctioned off La Marzocco espresso machines and Rotisol rotisserie ovens, as well as commercial blenders and grinders, refrigerators, grills and griddles, fryers, braising pans, and pizza ovens, according to a list posted by Heritage Global Partners. Electronics and furniture available for auction included Google Jamboards, NEC projectors, phones and speakerphones, soft seats and furnishings, and hundreds of office chairs.
Musk dismissed two-thirds of workers and told remaining employees that they should expect “extremely hardcore” working hours if they desired to stay at the company. He added that Twitter would become “much more engineering-driven,” implying a move away from “design and product management” emphases.