Google and Microsoft have announced layoff of thousands of employees in the past one week. 2022 was a pretty tough year because a lot of big tech companies fired workers to cut expenses and the start of 2023 also doesn't seem to be good because layoffs are being done across the industry and in big numbers. Amazon sacked 18,000 employees and Meta removed 11,000 headcounts. The rumours of Google planning to reduce headcounts have been in the news for a long time now, but the company declined it. Now, the search giant has made the layoff news official by confirming that 12,000 people are getting fired. Microsoft also did something similar. Here is the full story in ten points.
-Google's CEO Sundar Pichai has announced in a blog post that the company is all set to fire 12,000 employees. He also revealed that those who are staying in the US have already received an email for layoff, which basically suggests Google has already started the process. The layoff will be done across the globe.
-While the CEO has blamed the economic downturn for the layoff, he has also apologized for his decision by saying it is equally tough. He also thanked employees "for working so hard to help people and businesses everywhere." Pichai said, "contributions have been invaluable and we are grateful for them."
-Google confirmed the job cuts at Google are being done across Alphabet, product areas, functions, levels, and regions. The tech giant had gone through a rigorous review across product areas and functions to make sure that people and roles are aligned with the highest priorities.
-Google's CEO has promised to offer a severance package, which will include 16 weeks of salary, two weeks for every additional year at Google, and at least 16 weeks of GSU vesting. Google will also pay 2022 bonuses and remaining vacation time. Other benefits include 6 months of healthcare, job placement services, and immigration support for those affected.
-Pichai confirmed that the company will be organizing a town hall on January 22 to answer questions about how Google will move forward with layoffs. He also announced that impacted employees can take work from home because of this news.
-Similarly, Microsoft decided to fire 10,000 employees as the tech giant is preparing for slower revenue growth. The company has confirmed that it is making changes that will result in the reduction of our overall workforce by 10,000 jobs through the end of FY23 Q3. This basically means that Microsoft is not planning to fire all the people at once. Though, it has started the layoff process.
-The 10,000 employees that Microsoft is sacking represent less than 5 percent of total employee base it has. It plans to do the layoff process with full "transparency" to make it easier for employees.
- Microsoft did announce that it will be providing severance packages to the affected employees. The official announcement revealed that the people who are based in the US will get a variety of benefits, including above-market severance pay, healthcare coverage for six months, vesting of stock awards for six months, career transition services, and 60 days' notice prior to termination, regardless of whether such notice is legally required. As for other markets, the company said benefits for employees outside the US will align with the employment laws in each country.
-The tech giant confirmed that it is taking a $1.2 billion charge in Q2 related to severance costs, changes to its hardware portfolio, and the cost of lease consolidation as it plans to create higher density across its workspaces.
- Interestingly, Microsoft stated that it is eliminating roles in some areas, but it will continue to hire in key strategic areas. The tech company is planning to "allocate both its capital and talent to areas of secular growth and long-term competitiveness for the company, while divesting in other areas."
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