Bay Area tech expert explains how Google layoffs will impact Silicon Valley and beyond
SILICON VALLEY, California (KGO) — Thousands of tech workers, wondering if they would be the next to be laid off in the industry, learned of their fate on Friday.
Google’s parent company said it would cut its workforce by 6% in its largest round of layoffs.
Once on top of the financial mountain during the pandemic, tech companies are feeling the sense of a return to normal.
The bottom line is that giants like Meta, Microsoft and now Google are making employees feel the heat.
MORE: Layoff Tracker: Mass layoffs by technology companies large and small hit the Bay Area
“The revenues don’t justify the amount we have,” said SJSU professor and technical expert Ahmed Banafa. “That’s why at the end of 2022 you heard this conversation about ‘you have to work hard, we’re going to judge people’. As soon as you hear something like that, it’s an indication that the company is looking very closely at the bottom line and is trying to cut costs.”
And according to Banafa, those cuts start with employees, as we saw at Google on Friday.
“I have a lot of friends who work at Google, so I’m really worried about them,” Banafa said. “I’m afraid to call them.”
MORE: Google parent Alphabet to cut 12,000 jobs from global workforce
Twelve thousand employees of Google’s parent company Alphabet join other tens of thousands recently laid off from Silicon Valley companies in weighing budget decisions for 2023.
That comes just months away from the tech sector hiring more than 200,000 workers, more than double what we’ve seen in the previous decade, according to Banafa.
“During the pandemic, Google increased the number of employees by about 30%. What they’re doing is what I call “the great reset,” Banafa said. “They come back in the 2019 era. And even with the budget cuts we have, we’re not even close to that. We are still above that level.”
Banafa says these cuts are having a ripple effect as thousands of workers now have less money to spend, leading to cuts in other areas. But it’s not permanent.
MORE: Tech layoffs in 2023: Companies that cut back
Employees are rehired at other technology companies or in other technology positions at non-technology companies.
So that may be a temporary dip, but Banafa says it’s not 2008 or the “Dot Com, Dot Gone” era and won’t slow Silicon Valley’s rise to prominence.
“We have hundreds and hundreds of companies in Silicon Valley, and Silicon Valley has never been defined by one company,” Banafa said. “It’s just determined by the product and the innovation.”
If you’re using the ABC7 News app, click here to watch live
Copyright © 2023 KGO-TV. All rights reserved.
Not all news on the site reflects the site’s point of view, but we automatically transmit and translate this news through programmatic technology on the site and not from a human editor.