COVID-19 is turning into a massive black hole that is gulping in the world economy relentlessly. And such is the pull, that even the biggest of multinationals with the largest of cash reserves, are having to rethink their strategies. A number of firms across the globe are on a lay-off spree amid increasing financial losses. While Google hasn’t gone so far yet, it is now realigning its priorities to cut on “non-essential” expenses.
The tech giant will be slowing down the hiring process for the remainder of 2020, while the company will be “recalibrating the focus and pace of investments in areas like data centers and machines, and non-business essential marketing and travel.” This was revealed by Google Chief Executive Officer Sundar Pichai to the staff, via an email on Wednesday.
“The entire global economy is hurting, and Google and Alphabet are not immune to the effects of this global pandemic,” Pichai wrote. “We exist in an ecosystem of partnerships and interconnected businesses, many of whom are feeling significant pain.”
A Google spokesperson confirmed the memo to Bloomberg, adding that the hiring momentum will be focused on fewer “strategic areas” for now, while “on-boarding the many people who’ve been hired but haven’t started yet.” At the end of 2019, Alphabet employed 118,899 people full-time.
Small players have already been off-loading thousands of employees recently. A record 3.3 million people have already filed for unemployment benefits in the US. While the bigger firms went relatively unfazed in the initial days, they have also begun sweating now amid an unprecedented halt on activities. Reportedly, Microsoft has also paused recruiting for now, according to Business Insider. If this isn’t a testimony to the ominous times ahead, I don’t know what else is.
Google has been playing a major part in COVID-19 relief operations. The company has donated around $800 Million in cash grants and credits while undertaking many other smaller but significant steps to counter the economic effect of the pandemic. The company also hasn’t announced any job cuts till now, given the market has been relatively kinder to the California-based company. Google parent Alphabet closed lower by 1% in extended trading on Wednesday. The stock slipped to $1,257.30 in New York, down by almost 6% so far this year.