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Google Parent Will Fire 12,000 Employees As AI Emphasis Sharpens

Alphabet Inc., the parent company of Google, said Friday that it is eliminating 12,000 positions, or 6% of its workforce, as the technology industry struggles with layoffs and businesses gamble their futures on artificial intelligence (AI).

Shares Of Alphabet Increased By About 4% In Morning Trading

The U.S. corporation, which has long been a pioneer in important fields of AI research, is in a precarious position as a result of the downsizing.

Microsoft Corp. is now competing with Alphabet in a field of technology that, for example, can produce almost any form of material a user might imagine and put in a text box. Following the introduction of ChatGPT, a chatbot that can respond to questions with human-like replies by Microsoft-backed firm OpenAI, analysts in the industry predicted that so-called generative AI may challenge Google’s supremacy in internet search.

Microsoft said this week that it was also being forced by economic concerns to cut 10,000 positions or fewer than 5% of its staff, but that it would instead concentrate on incorporating more AI into its products moving ahead. Sundar Pichai, the CEO of Alphabet, repeated this idea in his message on layoffs.

When Alphabet quickly increased personnel, Pichai said he bore “full responsibility” for the company’s choices since it faced “a different economic reality” from the previous two years.

Pichai Was Named CEO Of Alphabet In 2019

The firm has “a huge opportunity in front of us with AI across our products,” he said, adding Google is preparing “to provide some whole new experiences for consumers, developers, and enterprises.”

According to two individuals with knowledge of the situation who spoke to Reuters, the business has been working on a significant AI rollout. It would happen, according to one of the sources, in the spring of this year. The New York Times also said that Google intended to introduce more than 20 new products, including a chatbot-enabled search engine.

According to Hargreaves Lansdown analyst Susannah Streeter, the main industry supporting YouTube and Google’s search engine, advertising, is not immune to economic uncertainty.

In stark contrast to the hectic times of the post-pandemic re-opening, which witnessed a spike in consumer spending, she added, “ad growth has cooled off the boil.” She said that the business also confronts dangers from regulations and competition.

If Alphabet will incur a one-time financial penalty because of the employment losses, it was not apparent. Microsoft said earlier this week that the cost of its severance packages, lease consolidation, and modifications to its hardware range would total more than $1 billion.

According to the monitoring website, about 155,000 people in the tech sector lost their employment in 2022, and this year alone, more than 38,000 of them have been let off. Inc, Meta Platforms Inc, and Salesforce Inc. are among the businesses that have laid off thousands of employees.

According to Pichai, Alphabet’s layoffs came after an assessment of its goals and employees that affected different geographic areas. Recruiters, corporate employees, and members of the engineering and product teams are among those losing their employment, he noted.

Workers in the US who are impacted will get severance, six months of healthcare, as well as assistance with immigration (Alphabet has already notified affected employees). California’s Mountain View is home to Alphabet.

One guy who claimed to work on Google’s Chrome browser tweeted that he had been fired just as he assumed responsibility for a project.

Layoff notices will take longer abroad owing to regional employment rules and customs, according to Pichai’s message.


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