Google has announced a wave of new layoffs despite making record profits, fueling concerns that staff are being replaced by AI.
The tech giant laid off about 1,000 employees across its sales, hardware and engineering teams last month, confirming that “a few hundred were laid off from each team.”
Google reported that it made a profit of $20.7 billion in the fourth quarter of 2023, an increase of 52 percent compared to the previous year, but its workforce shrank by four percent.
Other big AI investors, including Amazon, Microsoft, Discord and eBay, have also laid off tens of thousands of workers in the past 12 months.
Major technology companies continue to lay off employees amid advances in AI and despite rising revenues.
Staff are now pushing back against the layoffs, and Google software engineer Diane Hirsh Theriault wrote on LinkedIn that “glassy-eyed leaders are trying to point in a vague direction (AI) and at the same time kill their golden goose.”
The Alphabet Workers Union responded to the layoffs at X, writing: ‘Tonight, Google began another round of unnecessary layoffs.
‘Our members and teammates work hard every day to create great products for our users, and the company can’t keep laying off our coworkers while making billions every quarter. We won’t stop fighting until our jobs are secure!’
Kenneth Smith, an engineering manager at Google, said management notified him that his job was being eliminated in an email and he complained on LinkedIn. mail that the company did not “recognize his humanity.”
“I have harbored a lot of anger and frustration toward Google leadership for how they handled the layoffs of twelve thousand people last January,” he wrote, adding, “And I don’t see much evidence that they have learned much.” of that experience.’
Google last week launched its Goose large language model (LLM), which was created for internal use only and was trained on more than 25 years of engineering experience.
“It can answer questions about specific Google technologies, write code using internal technology stacks, and supports novel capabilities such as code editing based on natural language prompts,” according to an internal summary.
There have been significant layoffs as technology companies announced investments in AI, with more than 5,500 people laid off in the second week of January.
Both Amazon and Google announced they were laying off hundreds of workers last month, shortly after each separately confirmed they were investing millions of dollars in artificial intelligence startup Anthropic.
Microsoft laid off about 10,000 employees a year ago, and another 2,000 jobs were cut last month in its gaming unit, while Discord – a messaging app used by gamers – cut 17 percent of its workforce.
Google’s layoffs affected its entire advertising sales team, while Amazon eliminated positions at Prime Video and MGM Studios.
Since May 2023, 4,600 jobs have been lost due to AI, and nearly 41,800 employees have been laid off at 159 technology companies so far this year, according to data from Layoffs.fyi.
The layoffs come even as big tech companies saw a major rise in profits, with Google and Microsoft parent Alphabet Inc. reporting their shares rose 12 percent and their revenues expected to rise by 12 percent. percent by the first quarter of 2024.
Analysts at Mizuho Securities reported that Google’s earnings rose because it has a “strong position in the search and advertising market and a sustained track record of innovation and investments in AI.”
Google’s reported profits are the fastest growth rate since Alphabet reported a loss of $13.6 billion in 2022.
“It can answer questions about specific Google technologies, write code using internal technology stacks, and supports novel capabilities such as code editing based on natural language prompts,” according to an internal summary.
Although the number of layoffs peaked in 2023, it will continue through 2024, and Google reports that more layoffs will occur this year.
Although the number of layoffs directly attributed to AI this year remains relatively low, according to Challenger, Gray & Christmas, which reported that artificial intelligence was responsible for 381 job cuts in January, it is plausible that there will be more job cuts in the future. horizon.
He report He said most AI-related job cuts were either because companies were focusing on developing AI technology or because it was directly replacing tasks and roles that employees previously handled.
This is not uncommon at big technology companies, many of which have cut jobs as part of cost-cutting measures to invest money in artificial intelligence talent and expensive computer chips with graphics processing units (GPUs). ).
GPU chips focus on graphics rendering and numerical calculations to train artificial intelligence software.
Tech layoffs are impacting employees across industries, even as they invest millions of dollars in advancing AI technology.
“These companies are generally reducing the number of employees associated with unsuccessful product lines or divisions because they want to reposition themselves for AI,” said Art Zeile, CEO of DHI Group, owner of the tech recruiting platform Says. CNBC.
Google reportedly plans to make more layoffs in 2024, but CEO Sundar Pichai says it won’t be as bad as the mass layoffs in 2023, when the company cut 12,000 jobs in January alone.
Pichai said it’s necessary because the company needs to focus on “removing layers to simplify execution and drive speed in some areas.”
Google Senior Vice President Philipp Schindler addressed the company’s job cuts and restructuring efforts in a recent earnings call.
“I want to be clear: When we restructure, there is always the opportunity to be more efficient and smarter in the way we serve and grow our customers,” Schindler said.
‘We are not restructuring because AI is taking away roles, that is important here.
Artificial intelligence will affect up to 60% of jobs worldwide
Worldwide, 40 percent of all occupations are likely to be affected by AI.
He continued: “But we see significant opportunities here with our AI-powered solution to really deliver incredible (return on investment) at scale, and that’s why we’re making some of those adjustments.”
According to a recently leaked memo, artificial intelligence technology is Google’s main focus for 2024, and Pichai cited goals that include developing advanced, safe and responsible artificial intelligence and building the most useful personal computing platforms and devices. Benzinga reported.
“We have ambitious goals and this year we will invest in our big priorities,” Pichai wrote in an internal memo obtained by The edge.
“The reality is that to create the capacity for this investment, we have to make difficult decisions,” Pichai wrote.
Dailymail.com has contacted Google for comment.