Google’s chief financial officer warned employees that more cost-saving measures would come this year, including cutting back on employee cafes, fitness classes, and staplers.
Key Details
- In a memo to employees, Google CFO Ruth Porat announced that employee perks such as snack bars and employee cafeterias would be closed or have reduced hours, The Wall Street Journal reports.
- The company will also be reducing more necessary services, such as the frequency of laptop replacements, and providing office supplies, such as staplers and tape, CNBC reports.
- “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,” Porat says.
- Google’s decision to scale back its spending is the latest move in the tech industry as most Big Tech companies hunt for ways to lower costs.
Why it’s news
Though some of these cost-cutting moves seem to eliminate more frivolous employee services, these decisions come amid a string of cost-saving measures from the tech giant. At the beginning of the year, the Alphabet-owned tech company announced 12,000 layoffs. Google also decided against paying the remaining balance on maternity and medical leaves for laid-off employees, CNBC reports.
Google is not alone in its efforts to reduce costs. Tech companies across the industry have been implementing new procedures to save money amid economic uncertainty. Meta announced 10,000 layoffs earlier this year, along with an emphasis on efficiency. It laid off 11,000 employees last year.
Amazon also announced 9,000 job cuts earlier this month. It previously announced 18,000 layoffs.
In her email to employees, Porat referenced the 2008 recession.
“We’ve been here before. Back in 2008, our expenses were growing faster than our revenue. We improved machine utilization, narrowed our real estate investments, tightened our belt on T&E budgets, cafes, micro kitchens, and mobile phone usage, and removed the hybrid vehicle subsidiary. 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.”
Porat also indicated that the cost-saving measures would help the company focus on investment in other areas, including artificial intelligence development, CNBC reports.
