Google has avoided mass layoffs so far, but employees worry their time may be coming
Google CEO Sundar Pichai speaks on stage during the annual Google I/O developers conference in Mountain View, California, May 8, 2018.
Stephen Lam | Reuters
As industry-wide layoffs hit bigger tech names, some Google workers worry they’re next.
While Google has so far avoided the widespread job cuts that have hit tech companies, particularly those supported by a slumping ad market, internal anxiety is on the rise, according to documents viewed by CNBC and employees who spoke on the condition of anonymity.
Alphabet executives have stressed the need to sharpen “focus,” bring down costs of projects and make the company 20% more efficient. There’s also been a recent change in performance reviews, and some employees point to declining travel budgets and less swag as signs that something bigger may be on the horizon.
In July, Alphabet CEO Sundar Pichai launched the “Simplicity Sprint” in an effort to bolster efficiency during an uncertain economic environment. Just a few miles up the road, Meta told employees this month that it’s laying off 13% of its staff, or more than 11,000 employees, as the company reckons with declining ad revenue. Snap announced a 20% cut in August, and Twitter just slashed about half its workforce under the leadership of new owner Elon Musk. Elsewhere in Silicon Valley, HP said on Tuesday it plans to lay off 4,000 to 6,000 employees over the next three years.
Google’s business hasn’t been hit as hard as many of its peers, but the combination of a potential recession, soaring inflation and rising interest rates is having a clear impact. Last month, the company said YouTube’s ad revenue shrank from a year earlier as Google generated its weakest period of growth since 2013, other than one quarter during the pandemic. Google said at the time that it would significantly reduce headcount growth in the fourth quarter.
The crypto market, which put a dent in Google’s latest results, has fallen even further with the collapse of crypto exchange FTX, leading to increased concerns about industry contagion.
‘Don’t fire us please’
Cuts at Google have already taken place around the edges.
The company canceled the next generation of its Pixelbook laptop, slashed funding to its Area 120 in-house incubator and said it would be shuttering its digital gaming service Stadia.
Concerns about terminations are mounting, at least in certain corners. And some employees are turning to memes to express their anxieties through humor.
One internal meme shared with CNBC shows a before-and-after animated character. On the before side, the figure has his hands raised with the caption “inflation pay rise!” On the after side, a frightened character sits alongside the caption, “don’t fire us please.”
Another meme has names of tech companies — “Meta, Twitter, Amazon, Microsoft” — that recently conducted layoffs next to an image of a worried anime character. There were also memes created in reference to a statement last week from activist investor TCI Fund Management, which called on Pichai to cut salaries and headcount through “aggressive action.”
Among the workforce, Pichai found himself on the defensive in September, as he was forced to explain the company’s changing position after years of supercharged growth. Executives said at the time that there would be small cuts, and they didn’t rule out layoffs.
At a more recent all-hands meeting, a number of questions regarding the potential for layoffs were highly rated by staffers on Google’s internal question-asking system called Dory. There were also questions about whether executives mismanaged headcount.
“It appears that we added 36k full-time role YoY, increasing headcount by about 24%,” one top-rated question read. “Many teams feel like they are losing headcount, not gaining it. Where did this headcount go? In hindsight, and given concerns around productivity, should we have hired so rapidly?”
Employees wanted details following the company’s latest earnings call and comments from CFO Ruth Porat regarding possible cuts.
One question read: “Can we get some more clarity on how we’re approaching headcount for 2023? Do we have any sense of how long we need to plan for difficult headwinds?”
Other questioners asked if employees “should expect any direct consequence to our teams, direction and/or compensation to reduced profits we saw in the earnings call” and wondered, “how are we going to achieve 20% more productivity? Will refocus be enough or are we expecting layoffs?”
Change to performance reviews
Furthering employee stress levels was a recent change to performance reviews and upcoming evaluation check-ins.
Earlier this year, Google said it was ditching its long-held practice of handing out lengthy promotion packets, which were long forms employees needed to fill out and that included reviews from bosses and co-workers. The company switched to a streamlined process it calls Googler Reviews and Development (GRAD).
A Google spokesperson said in an emailed statement that the GRAD system was launched “to help employee development, coaching, learning and career progression throughout the year,” adding that it “helps establish clear expectations and provide employees with regular feedback.”
Google said a new system would result in higher pay, but workers say the overhaul has left more room for ambiguity in ratings at a time when the company is looking for ways to cut costs.
The planned overhaul has already run into problems. The company decided to end its use of Betterworks, a program that was supposed to help with evaluating performance, employees told CNBC. Executives said they planned to instead use a home-grown tool, but the change has come uncomfortably close to expected year-end performance checks.
A guide titled “Support Check-Ins,” which are performance reviews targeting certain employees, began appearing in internal forums. The document, viewed by CNBC, says for those who receive the review, “the current performance trajectory is headed toward, or already is in, a lower rating.”
Three steps are recommended for check-ins. The first directs workers to “breathe,” before taking in managers’ feedback. Second is, “understand the feedback,” and third is to “devise a plan.” The document says check-ins may affect 10% to 20% of staffers over the course of a year.
Add it all up, and one big question employees are asking is — will a bunch of small cuts turn into something grander in the future?
CNBC reported last month that employees and executives clashed on the topic of cutbacks to things like swag, travel and holiday celebrations. Workers complained about a lack of transparency around travel cuts and asked why the company wasn’t saving money by cutting executive salaries.
Google engineering leaders recently began cracking down on employees’ ability to access links to the internal meme generator called Memegen, a repository of user-generated memes that has long been a part of the company’s open culture.
Last month, a Google vice president of corporate engineering said employees need to remove Memegen links from their profile pages, internally known as “Moma.” Engineering directors said in an internal message that having a Memegen link on profiles “prevents Googlers from sharpening their focus.”
Workers naturally flocked to Memegen to make fun of the decision.
A trader works on the floor of the New York Stock Exchange on Oct. 30, 2025 in New York.
Angela Weiss | AFP | Getty Images
This week’s equity market wobble, which saw a retreat in U.S. artificial intelligence-related stocks amid ongoing concerns over stretched valuations, has thrust contagion fears into the spotlight for global investors.
Goldman Sachs CEO David Solomon warned this week of a “likely” 10-20% drawdown in equity markets at some point within the next two years, while the International Monetary Fund and the Bank of England have both sounded the alarm bells.
Bank of England Governor Andrew Bailey highlighted the possibilities of an AI bubble in an interview with CNBC on Thursday, noting that the “very positive productivity contribution” from technology companies could be offset by uncertainty around future earning steams in the sector.
“We have to be very alert to these risks,” Bailey said.
Legrand is one of several European companies which is benefitting from the AI boom. The French company, which sells products to Alphabet, Amazon and others to help cool servers, has seen its shares surge 37% this year, roughly as much as Nvidia.
Anders Danielsson, CEO of Swedish construction group Skanska, which builds data centers and other AI infrastructure assets, shrugged off concerns about a slowdown.
“In the U.S. we have a very strong pipeline of data centers — we don’t see any slowdown there,” he told CNBC. “We are working with large international customers and they are also interested in building data centers in central Europe, and in the Nordics and the U.K. We haven’t seen any slowdown really.”
Meanwhile Kiran Ganesh, multi-asset strategist at UBS, highlighted a notable lack of volatility, adding that the broader narrative remains positive.
“We’ve had a remarkably smooth rally given the scale of investment that’s taken place, given the uncertainty about future cash flows, and given some of those concerns about valuation,” Ganesh told CNBC’s “Europe Early Edition” on Friday.
“As we’ve gone through earnings season, I think it’s reasonable to have expected some volatility, but actually when we look at the results, and they have been reassuring, we’re still up over the course of earnings season and they have been beating expectations. So although some volatility has been materializing this week, we think that’s to be expected and the bigger picture still remains positive.”
Still, many investors appear to be souring on the increasingly-stretched valuations.
In Asia, shares of SoftBank Group — which is active across AI infrastructure, semiconductor and application companies — have fallen sharply, with the Japanese group suffering almost $50 billion in weekly losses. SoftBank resumed its downward trajectory on Friday, after dropping about 10% on Wednesday.
On Tuesday, it emerged that Scion Asset Management, the hedge fund led by “The Big Short” investor Michael Burry, had built short positions against both Palantir Technologies and Nvidia, drawing the ire of Palantir CEO Alex Karp.
“Some big tech stocks are on sale, and are presenting buying opportunities for investors, especially for investors who have missed out on the market’s strength over the past two months,” said Glen Smith, chief investment officer at GDS Wealth Management.
Other investors have flagged concentration risk in U.S. equities, and advocate looking further afield.
Luca Paolini, chief strategist at Pictet Asset Management, said stretched valuations mean the firm is neutral on U.S. names. “Emerging markets are preferred, with diversified exposure across India, Brazil, and broader EM benefiting from AI-driven investment and monetary easing,” Paolini said in a market commentary.
Technology
CEO of Southeast Asia’s largest bank warns investors: ‘Buckle up, we’re in for a volatile ride’
Tan Su Shan is the CEO and director of DBS Group.
Bloomberg | Bloomberg | Getty Images
With valuations in the U.S. stock market becoming increasingly stretched, the chief executive of Southeast Asia’s largest bank is warning investors to expect turbulence ahead.
“We’ve seen a lot of volatility in the markets. It could be equities, it could be rates, it could be foreign exchange,” DBS CEO Tan Su Shan told CNBC, adding that she expects that volatility to continue.
Tan, who took over the helm of DBS from longtime CEO Piyush Gupta in March, said that investors were particularly worried about the lofty valuations of artificial intelligence stocks, especially the so-called “Magnificent Seven.”
The Magnificent Seven — Amazon, Alphabet, Meta, Apple, Microsoft, Nvidia and Tesla — are some of the major U.S. tech and growth stocks that have driven much of Wall Street’s gains in recent years.
“You’ve got trillions of dollars tied up in seven stocks, for example. So it’s inevitable, with that kind of concentration, that there will be a worry about. ‘You know, when will this bubble burst?'”
Earlier this week, at the Global Financial Leaders’ Investment Summit in Hong Kong, it was likely there would be a 10%-20% drawdown over the next 12 to 24 months.
Morgan Stanley CEO Ted Pick said at the same summit that investors should welcome periodic pullbacks, calling them healthy developments rather than signs of crisis.
Tan agreed. “Frankly, a correction will be healthy,” she said.
Recent examples include Advanced Micro Devices and Palantir, both of which posted stronger-than-expected quarterly results on Tuesday, yet their shares — and the wider Nasdaq — fell.
Her remarks follow similar warnings by the International Monetary Fund and central bank chiefs Jerome Powell and Andrew Bailey, who have all cautioned about inflated stock prices.
Singapore as diversification play
Tan advised investors to diversify rather than concentrate holdings in one market. “Whether it’s in your portfolio, in your supply chain, or in your demand distribution, just diversify.”
Tan, who has over 35 years of experience in banking and wealth management, noted that Asia could attract more investment from the U.S.—and that it’s not a bad thing.
Singling out Singapore and the country’s central bank’s efforts to boost interest in the local markets, Tan described the city-state as a “diversifier market.”
“We’ve got rule of law. We’re a transparent, open financial system and stable politically. We’re a good place to invest…. So I don’t think we’re a bad place to think about diversifying your investments.”
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