Changes to Google’s employee appraisal system are likely to spur layoffs.

Despite Google‘s assertions, a report claiming to have details on how employees are evaluated at the company has sparked forecasts of widespread layoffs.

A number of major technology companies in the last few months have announced layoffs due to macroeconomic headwinds. Google is now being held under the spotlight with recent news reports suggesting that the company will be cutting at least 10,000 jobs.
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The latest update to Google’s policy is called Review Development, and it mandates that managers must use a low performer rating for at least 6% of their employees.

It’s no secret that putting a bad employee on the chopping block is going to result in decreased productivity and higher risk.

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Google said that it has a total of 186,779 full-time employees at the end of September. This is a 24.5 percent year-on-year increase. This number accounts for six percent of their current headcount, which puts the figure at approximately 11,000 people.

We were unable to confirm the exact number of layoffs in our recent Information report. What we can tell you is that Google has implemented a new initiative— GRAD—to help retain high-quality employees and provide them with opportunities for development.

“Earlier this year, we launched Google Review and Development (GRAD) to help employee development, coaching, learning, and career progression throughout the year,” according to a statement from Google.

It was announced in May that Google will now “de-prioritize” older employees’ performance reviews that take place twice a year. After almost 47% of employees voted against the time-consuming process, it was greatly reduced.

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Under GRAD, a manager is expected to hold a ‘check-in’ meeting before providing a low performance rating or rating below ‘significant impact,’ according to a source who spoke on condition of anonymity.

It’s not about the destination, it’s about the journey. The work style at Wayfair is shifting to be more flexible, individualized, and actionable so that employees can ensure their goals are met.

Despite these concerns, CNBC reports that Microsoft’s employees are still anxious about the new performance review board because appraisals under this system come at a time when the company is looking to cut operating expenses. Lower performance ratings have already started trickling in for some employees, according to the report.

After the company announced a hiring freeze, which was followed by their Simplicity Sprint program, in order to boost staff efficiency and productivity. While announcing the launch of Simplicity Sprint, CEO Sundar Pichai alluded to macroeconomic uncertainty, saying that their productivity was nowhere close to where it should be based on headcount.

Google, Alphabet’s parent company, announced changes to their product lineup after a series of less-than-stellar quarterly results.

Google is considering global changes to their search engine in order to efficiently grow revenue

In the third quarter, Google Cloud revenue grew 38% year-on-year. While ad revenue slid 3% this quarter, overall revenue growth slowed to 6%.

The company also saw an increase in revenue during the quarter, and it attributed that to the growth of its headcount. Mandiant said that in the third quarter, it added a total of 12,765 employees from December to February.

For the fourth quarter, the company anticipates hiring a number lower than what it had hired in the third quarter, and that only critical roles be added focused on engineering and technology talent.

In recent weeks, layoffs by companies such as Meta, Amazon, Microsoft, Salesforce and Oracle have not boosted employee confidence.

It’s no wonder tech companies are thinking about cutting jobs now. With macro-economic conditions like inflation, recession, and slow revenue growth, it makes sense for them to cut into the budget for 2023. And with large tech companies already struggling to make ends meet, you can imagine how difficult it will be for them when they try to maintain those budgets in 2020.

GRAD suggests, the firings at Twitter were chaotic and draconian, but Google’s staff cuts will at least be made on a rational, targeted basis.

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