Googlers Demand Answers From Execs About ‘Decline in Morale’

Google execs found themselves in the hot seat once again as employees demanded answers about a "decline in morale" at a time when the company is posting record earnings....
Googlers Demand Answers From Execs About ‘Decline in Morale’
Written by Matt Milano
  • Google execs found themselves in the hot seat once again as employees demanded answers about a “decline in morale” at a time when the company is posting record earnings.

    Google has been on a roll, posting stellar quarterly reports, crossing the $2 trillion valuation, and spending tens of billions on buybacks. According to CNBC, staff wanted to know at a recent all-hands meeting why the company’s success wasn’t filtering down to employees, and what the company planned to do to address declining morale.

    “We’ve noticed a significant decline in morale, increased distrust and a disconnect between leadership and the workforce,” read a comment the company’s internal forum. “How does leadership plan to address these concerns and regain the trust, morale and cohesion that have been foundational to our company’s success?”

    Much of the distrust comes from Google engaging in mass layoffs, something many thought would never happen, and something Google took pride in never doing. Simultaneously, CEO Sundar Pichai’s got a pay raise in 2022, raking in a whopping $226 million. As a result, Googlers began likening Pichai to Lord Farquaad from Shrek.

    Adding insult to injury, many Googlers have not received meaningful pay raises.

    “Despite the company’s stellar performance and record earnings, many Googlers have not received meaningful compensation increases” read another top-rated employee post. “When will employee compensation fairly reflect the company’s success and is there a conscious decision to keep wages lower due to a cooling employment market?”

    See Also: VC Investor: ‘Half the White-Collar Staff at Google Probably Does No Real Work’

    In response to a question about how the company is allocating its investments—stock buybacks vs investing in AI—CFO Ruth Porat and Pichai both emphasized efforts to avoid the company’s past missteps of allowing expenses to outpace revenue growth.

    “Our priority is to invest in growth,” Porat said. “Revenue should be growing faster than expenses.”

    “The problem is a couple of years ago — two years ago, to be precise — we actually got that upside down and expenses started growing faster than revenues,” added Porat. “The problem with that is it’s not sustainable.”

    Pichai directly addressed the declining morale question, saying “leadership has a lot of responsibility here,” saying “it’s an iterative process.”

    “We hired a lot of employees and from there, we have had course correction,” Pichai added.

    Google has been in the news recently for laying off teams and relocating jobs to cheaper markets. That seemed to motivate a couple of questions on the internal forum:

    “Given the recent headcount and positive earnings, what is the company’s headcount strategy?” one question read, with another asking: “Given the strong results, are we done with cost-cutting?”

    Pichai did not rule out additional layoffs in 2024, but said the bulk of them were done.

    “To be clear, we’re growing our expenses as a company this year, but we’re moderating our pace of growth” Pichai said. “We see opportunities where we can re-allocate people and get things done.”

    “Assuming current conditions, the second half of the year will be much smaller in scale,” Pichai added. The CEO said the company “very, very disciplined about managing headcount growth throughout the year.”

    Pichai is clearly trying to calm Googlers who have been shook by changes in how the company operates. The CEO has been under siege of late, both for being tone-deaf and for failures to effectively execute the company’s AI strategy. Some investors and critics have called for Pichai to be fired or resign as a result.

    “My guess is he (Sundar Pichai) will be fired or resign- as he should,” said Helios Capital founder, Samir Arora. “After being in the lead on AI he has completely failed on this and let others take over.”

    Only time will tell if the company’s recent all-hands meeting will calm nerves and restore confidence.

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