The tech crunch is getting tighter as big tech companies continue laying off employees by the thousands. Microsoft announced 10,000 layoffs only a few days ago, and now Alphabet, Google’s parent company, has made a similar announcement.
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Alphabet has cut 12,000 of its employees, which amounts to 6% of the company’s workforce. According to Reuters, the tech sector is in the midst of massive layoffs and broader adoption of artificial intelligence. Even with these new layoffs, Reuters reports that Alphabet’s stock price was up 3% in pre-market trading.
Google CEO Sundar Pichai said that Google was gearing up “to share some entirely new experiences for users, developers, and businesses,” The company has “a substantial opportunity in front of us with AI across our products.”
With new AI tools like ChatGPT and companies like CNET using AI to write articles, it seems the tech sector may not be lucrative to stake a job claim. Alphabet is one of the leading tech companies advancing AI technologies, as are Microsoft and Facebook.
Another reason Alphabet gave for these layoffs is the decrease in ad spending, as advertising is a considerable part of Google’s revenue plan. Reuters reports: “Ad growth has come off the boil, a sharp contrast from the busy days of the post-pandemic re-opening, which saw a surge in consumer spending,” she said. The company faces competitive and regulatory threats as well, she said.
Things are certainly getting interesting in the tech sector. We shall see how things pan out.
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Last Updated on January 20, 2023.