A tipster is hearing from inside the Googleplex that the company, which is set to report earnings today, could lay off 5 percent of its engineering staff.
Google is preparing to announce its earnings as soon as markets close today. The search giant just had its first real layoffs last week, with 100 recruiters given the axe. (Previously, the company had only laid people off to consolidate jobs after an acquisition.) The company also closed some satellite engineering offices, but officials said the company would try to place those engineers elsewhere. If the layoffs are happening, there may not be seats for them.
That's hardly the worst of the news, if the rumor's true. Google has approximately 6,000 engineers; a 5 percent cut, 300 people, would barely be felt by the organization. But before Google lays off any engineers, it will surely slash payrolls in other departments — which means the total could well exceed 1,000. (A Google spokeman, Jon Murchinson, did not immediately return a phone call or email.)
The layoff may not happen. But the fear in the Googleplex is well-founded. It's not that Google is bleeding money; Wall Street is expecting it to report 2008 revenues of $15.8 billion, with still-handsome profit margins. And it may even surprise analysts with better-than-expected numbers. But the economy is parlous, and Google is simply not growing like it did in the first years after its 2004 IPO. Google's headcount has nearly doubled in size to 20,100 in two years. And we hear that Google cofounders Larry Page and Sergey Brin, who set out to recreate at the Googleplex the academic environment they knew at Stanford University, are growing increasingly disenchanted with how soft and spoiled Google's engineers have become.
Before Google let go many of its 10,000 contractors last fall, they were doing much of the company's gruntwork. For the first time, many Google engineers are finding they have to do serious, boring work that actually contributes to the company's bottom line, rather than pursuing fanciful ideas of Googly new products. To the extent that they fit the caricacture of a Google engineer, many may whine — in which case, they may well find themselves unburdened of the work, and the paycheck that came with it.