Reports say that a mass lay-off spree could kick-off at Google very soon. A new performance management system has reportedly allowed Google to identify 'poor performing' employees, raising the possibility that the company may begin laying off almost 10,000 workers in early 2023, in the midst of widespread layoffs in the tech industry across Silicon Valley.
Google has avoided laying off any staff so far, unlike its rivals Twitter, Meta, and Microsoft. Yet, a new performance monitoring system may "assist" managers get rid of thousands of low-performing staff, as reported by a US media company, "The Information". This comes as a result of increased demand from outside sources to increase worker productivity. According to the research, managers might use the ratings as a way to get out of giving employees incentives and stock awards.
It's being said that Google instructed its managers to label 6% of its workforce (approximately 10,000 workers) as low performers based on their influence on the business, up from 2% under the prior assessment method.
Apparently, the new method was announced in very general terms. The number of workers who can get a good review under the new approach is less. According to the article, Hedge fund billionaire Christopher Hohn argued in a letter to parent company Alphabet that the number of employees in the company needed to be cut, prompting the command to categorise individuals as "poor performing."
The British investor also claims that Google pays its staff more than other tech firms. The company's workforce, according to the billionaire, is "excessive" compared to hiring trends of the past and does not fulfil the needs of the current business climate.
Using data from the US Securities and Exchange Commission, media outlets estimate that the average compensation at Alphabet in 2021 was roughly $295,884, which was much more than the average salary at Microsoft by more than 70%. When compared to the twenty top technology businesses in the United States, Alphabet compensated its employees 153% more.