Google is slowing hiring after a recent spree, making it the latest major tech company to take a more cautious stance as the threat of an economic recession grows.
Sundar Pichai, chief executive of Google’s parent company Alphabet, told employees in an internal email on Tuesday that the company would “slow the pace of hiring for the remainder of the year,” without giving details.
This follows moves by Microsoft and Facebook owner Meta to ease recruitment in certain areas in recent weeks. The change comes amid a scorching job market in Silicon Valley that until recently defied the growing mood of caution.
The sudden cooling in financial markets prompted many startups to rethink hiring or downsize, leaving Google and other big tech companies in a strong position to pick up the slack, albeit at a slower pace.
Fast delivery startup Gopuff on Tuesday became the latest startup to pull out, saying it would cut around 1,500 workers, or 10% of its staff, and close 76 warehouses.
According to its founders, the action was prompted by economic uncertainty which had brought an “inflection point” for the fast delivery groups that have become emblematic of the type of hypergrowth companies that emerged when capital was abundant. .
The Google chief said the slowdown in hiring at the internet company was a direct result of the large number of new jobs created this year. However, he also warned of deteriorating economic prospects and said Google would “pause development” in certain areas to focus investment.
“The uncertain global economic outlook has been at the forefront. Like all businesses, we are not immune to economic headwinds,” Pichai said.
The slowdown in hiring follows a recent surge in the number of employees at the internet search firm as its business boomed out of the pandemic. Pichai said it added about 10,000 new workers in the second quarter.
With Google accounting for the vast majority of Alphabet’s operations, the latest additions will bring the total number of jobs added to the group as a whole this year to around 17,500 – not far off the 21,200 taken in 2021. Alphabet reported that it had 163,906 workers at the end of March.
The hiring surge followed a sharp drop in new jobs at the start of the pandemic, as Google suffered its first-ever drop in revenue. But the company quickly reversed course when the decline proved to be short-lived.
Pichai said Google already has a “high number of hires” for new workers starting in the current quarter, many of whom are recent college graduates, and will focus its hiring for this year and in 2023 on “engineering, technical and other critical roles”.