As one of the world’s most innovative and successful tech companies, Google has always been renowned for its employee perks. From free gourmet meals to on-site massage therapists, working at Google seemed like a dream job for many. However, recently there have been reports stating that the company is cutting back on these extravagant benefits in an effort to reduce costs. Why is this happening? What are the implications for employees and the company as a whole? In this post, we will delve inside Google’s cost-cutting measures to uncover what’s really going on behind-the-scenes.
Google Slashes Employee Perks
Google is slashing employee perks, and it’s not the only tech giant doing so. Microsoft, Facebook, and Apple have all announced or started making changes to their benefit packages in recent months.
Part of the reason for this cost-cutting is that the tech industry is growing more competitive and companies are trying to keep up with rivals. But there’s another reason too: cash flow.
According to Business Insider, Google has been struggling financially lately and needs to reduce its costs in order to stay afloat. One way it’s doing this is by cutting back on employee benefits.
Google says that it will now give employees a choice between two types of paid leave: 10 days of paid paternity leave and 12 weeks of fully paid maternity leave. The company also said that it will no longer provide unlimited sick days and flexible work hours.
These changes might upset some employees, but they’re necessary if Google wants to keep its profits steady while continuing to invest in new technology platforms like Google Fiber and the Google Cloud Platform.
The Cost-Cutting Measures
Google is making big cuts to employee perks in an effort to save money. The cost-cutting measures are part of a larger plan to reduce Google’s costs by $1 billion over the next three years.
Some of the perk reductions include ending free food and snack offerings, reducing or eliminating vacation days, and scaling back company-sponsored events. These changes come on top of other cost-cutting measures, like working from home more often, which has already saved the company millions of dollars in salary costs.
Critics say that the cuts will make it difficult for Google employees to feel engaged and motivated at work. Others argue that the company could be doing more to share the savings with its workers. Either way, it’s clear that Google is looking for ways to save money while still maintaining its competitive edge.
Why Google Is Doing This
Google is slashing employee perks across the board in an effort to rein in costs. In a memo obtained by The Verge, CEO Larry Page wrote that “the number one driver of excessive spending at Google was employee benefits and compensation.” Employee perks, he argued, are not only a financial burden but also create an environment where employees feel they are “above the law.”
Page isn’t the first business leader to criticize lavish employee perks. In early 2016, Starbucks CEO Howard Schultz said that high salaries and benefits were partly to blame for the company’s sluggish performance. “We paid too much attention to how we were going to reward people instead of how we were going to help people do their jobs better,” Schultz said at the time.
But while other companies have been forced to scale back employee benefits, Google has been able to maintain its expansive list thanks largely to its cash reserves. Page argues that cutting back on benefits won’t hurt morale as much as reducing salaries would; after all, he says, employees can still “take home equity” if they leave Google.
That may be true for some workers, but others — especially those who rely on generous severance packages — may find themselves out of a job. And with unemployment hovering near historic lows, there’s likely plenty of talent available on the market willing to take lower pay and fewer perks.
The Impact on Employees
Google’s cost-cutting measures are having a significant impact on employees. In recent months, the tech giant has announced reductions in employee perks, including free food and drinks, paid vacations, and free housing.
According to The New York Times, Google is aiming to reduce its costs by $2 billion over the next four years. The company is also reportedly considering ending some employee benefits, such as healthcare and maternity leave.
Some employees are concerned that they will not be able to afford these cuts without losing their jobs. Others say that they are happy to sacrifice some luxuries in order to save money.
Either way, this is a major change for Google, which traditionally has been one of the most generous employers when it comes to employee perks.
Conclusion
While some companies are choosing to keep perks in order to maintain a positive image, Google is choosing to slash employee perks in order to save money. This change comes as the tech giant continues its cost-cutting measures and efforts to become more profitable. With this move, Google is saving money while also reducing employee morale – something that could have long-term consequences for the company’s success.
