As fears of a recession grow and revenue decline, big tech companies are bracing for harder times ahead. Amazon, Microsoft, and Meta have all announced layoffs, cutting thousands of employees and workers across the board. While Google has so far evaded this trend, focusing instead on cutting projects and restructuring employees internally, this seems to be changing. A report shows that Google’s parent company Alphabet is preparing to lay off 12,000 employees.

A report from Reuters cites an internal memo from Google and Alphabet CEO Sundar Pichai taking responsibility for the cuts. He says that after rapidly expanding the headcount, the company is now facing a “different economic reality” than anticipated. In the US, affected employees have reportedly been contacted and let go already, while many in other countries may be spared for a few more weeks or months due to stricter labor laws.

The memo has since been published in full by Google itself. In the 600-word email, Pichai offers full responsibility for the layoffs and calls this day one of the toughest for the company, but at the same time, sees opportunities for Google ahead. According to him, the company is in a good position thanks to its early investments in AI, with its products "better than ever."

According to Reuters, the main departments affected are recruiting, unspecified corporate functions, and some engineering and product teams. The memo itself mentions positions "across Alphabet, product areas, functions, levels and regions." In total, the 12,000 laid off employees make up 6% of Google's workforce.

Among the affected is also senior staff, like senior software engineer Christ McDonald at the Chrome OS build team, who was taken by surprise by the news, having only recently been promoted and expecting a good performance review.

The news comes in the midst of a feared economic downturn affecting the entire tech industry. As mentioned above, other companies have already announced massive layoffs, including Amazon, Microsoft, and Meta. So far, Google had managed to avoid this drastic step, but it looks like this was no longer possible. The only Big Five company left without layoffs is now Apple, which has its stock drop just like others, but is still left comparatively well off.

Before the layoffs, Google tried to cut costs by restructuring internal teams. The company reduced funding for Area 120, canceling half of the big-bets-oriented division’s projects. It also merged its two mapping teams from Waze and Google Maps. The company additionally shut down its game streaming service Stadia just this month. At the same time, Google is seeing its core search business threatened by ChatGPT, an AI-powered chatbot in beta that can provide (often flawed) answers in fully spelled out sentences.

UPDATE: 2023/01/20 11:02 EST BY MANUEL VONAU

Sundar Pichai's internal memo published in full

Following the initial coverage, Google has published its CEO's internal memo to staff in full. We've updated the article accordingly.