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Industry Trends

Google Downsizes

By January 16, 2009July 30th, 20233 Comments

There is some bad news for the IT industry in general, and for Google employees in particular. It looks as though the recession is beginning to catch up with the search giant.

A few months ago, Google relocated some of their engineers from Phoenix-Arizona, to other places. Now another 70 employees from Austin-Texas, Trondheim in Norway and Lulea in Sweden are being asked to do the same. The reason behind this is to have fewer but better-coordinated engineering sites, which would help reduce overhead costs, while retaining the quality and efficiency of their services.

Another major step being taken by Google is to reduce the number of new recruits. Initially, they ended all the contracts they had with the outside sources that provided recruiting services to them. Now, however, they have gone a step further and decided to reduce the size of their recruiting department by as many as 100 people. The logic is, of course, that since they will be recruiting fewer people for quite some time, they will require less people to do so. However, the management is hopeful that most of these staff members will be reassigned to other appropriate jobs within the organisation itself.

While Google had laid off 300 employees of their subsidiary, DoubleClick, last year, the Times points out that this is the first time their own employees are being made redundant.

Google has also announced that they will discontinue some services that have not been doing too well or have been replaced by better apps. Amongst them are Jaiku, Dodgeball, Catalog Search, Google Notebook and uploads for Google Video.

Another indication of their cost cutting efforts is the fact that instead of the $1,000 bonus that employees get as a gift every year, this time they were just given a new T-Mobile G1 mobile phone.

Though these measures are relatively minor compared to the layoffs at Yahoo! and other tech companies in recent month, it is certainly bad news that the one company most experts thought would sail through the reecession unscathed is already trimming its workforce.

The worst is probably yet to come. Among other technology firms, Motorola has announced 4,000 job cuts, while there are unconfirmed rumors about the possibility of 15,000 layoffs at Microsoft.