California: Google has laid off 10 percent of its managerial staff in a bid to improve operational efficiency, with plans to reduce this number even further. The move comes as the tech giant faces mounting pressure from advancements in artificial intelligence (AI) and competition from firms like OpenAI.
In an all-hands meeting held on Wednesday, CEO Sundar Pichai confirmed that the cuts would affect managers, directors, and vice presidents. A Google spokesperson clarified to Business Insider that some employees would be reassigned to individual contributor roles, while others would face complete role eliminations.
The decision follows rapid advancements in AI technology, particularly as OpenAI has emerged as a formidable competitor in the field. These developments are seen as a direct challenge to Google Search, which remains a significant revenue stream for the company, accounting for over 57 percent of its total income last year, reported different media.
To stay competitive, Google has been integrating generative AI features into its products, most recently launching its advanced Gemini 2.0 model. Pichai described the launch as marking the start of a “new agentic era,” with AI models designed to make decisions and understand complex inputs. The announcement saw Google’s stock rise by more than 4 percent, following a 3.5 percent jump the previous day after the unveiling of a new quantum chip.
This round of layoffs marks the fourth for Google this year, following earlier cuts in its global advertisements team and cloud division. Earlier in 2023, the company laid off 12,000 employees, about 6.4 percent of its workforce, as part of an ongoing efficiency drive that started in September 2022.
During the 2023 workforce reduction, Pichai took full responsibility for the decisions but emphasized that they were necessary after a period of rapid expansion. The CEO explained that the company had to make difficult decisions to prevent future challenges.
In the latest meeting, Pichai also addressed the need to reshape Google’s corporate culture and reimagine the concept of “Googleyness,” the term often used to describe the traits the company values in its employees. The comments reflect Google’s ongoing efforts to adjust to the changing technological and business landscape.
