Google Cuts Third of Its Managers, Executive Says

Google has streamlined its operational structure, eliminating over a third of its managers overseeing small teams, a move confirmed by an executive last week. This underscores the tech giant’s ongoing push for enhanced efficiencies across its vast organization.

“Right now, we have 35% fewer managers, with fewer direct reports,” compared to the same period last year, revealed Brian Welle, vice president of people analytics and performance, according to audio from an internal all-hands meeting reviewed by CNBC. “So a lot of fast progress there.”

The all-hands meeting saw employees querying Welle and other executives about job security, perceived “internal barriers,” and the evolving Google culture following a series of recent workforce reductions, voluntary exit programs, and strategic reorganizations.

Welle emphasized that the core objective is to dismantle bureaucratic hurdles and foster a more streamlined, efficient operating model.

“When we look across our entire leadership population – that’s managers, directors and VPs – we want them to be a smaller percentage of our overall workforce over time,” he explained, hinting at a continuing trend.

According to a source familiar with the matter, the 35% reduction specifically targets managers who oversaw teams of fewer than three individuals. Crucially, many of these managers have transitioned into individual contributor roles within the company, demonstrating a focus on retaining talent during this structural shift. The source requested anonymity because the details are private.

Google CEO Sundar Pichai, addressing concerns during the meeting, reiterated the necessity for Google “to be more efficient as we scale up so we don’t solve everything with headcount.” This statement highlights the company’s strategic pivot towards optimizing resources and leveraging existing talent more effectively.

In 2023, Google trimmed approximately 6% of its global workforce and has since implemented targeted staff reductions across various divisions. Alphabet’s CFO, Anat Ashkenazi, who joined the company last year, signaled in October her commitment to driving cost savings “a little further.” Since January, Google has extended voluntary buyout offers to employees and tempered its hiring pace, effectively challenging employees to achieve more with fewer resources.

Executives disclosed at the town hall that a total of 10 product areas have presented “Voluntary Exit Program” offers, targeting U.S.-based employees within search, marketing, hardware, and people operations teams this year.

Google’s Chief People Officer, Fiona Cicconi, noted at the meeting that between 3% and 5% of employees on those select teams have already accepted the voluntary packages.

“This has been actually quite successful,” she stated, suggesting further application: “I think we can continue it.”

Pichai emphasized that the company structured the voluntary exits after actively soliciting employee feedback, with workers indicating a preference for buyouts as opposed to more disruptive, broad-based layoffs. “It’s a lot of work that’s gone into implementing the VEP program, and I’m glad we’ve done it,” Pichai said. “It gives people agency, and I’m glad to see it’s worked out well.”

According to Cicconi, a primary driver behind employees electing for voluntary departures is the desire for a break from the rigors of corporate life.

“It’s actually quite interesting to see who’s taking a VEP, and it’s people sort of wanting a career break, sometimes to take care of family members,” she revealed, painting a picture of individual choices and shifting priorities within the workforce.

The workforce reductions had previously taken a toll on employee morale, and some within the company have pointed out that staff are being asked to do more with less. Alphabet’s shares are up 10% this year after climbing 36% in 2024 and 58% the year prior.

Google employees at the town hall meeting also raised the prospect of Google implementing a policy similar to Meta’s “recharge” initiative, a month-long sabbatical offered to employees following five years of service.

“We have a lot of leaves, not least our vacation, which is there for exactly that — resting and recharging,” countered Alexandra Maddison, Google’s senior director of benefits.

Maddison made clear that the company wasn’t plannning on offering paid sabbatical, saying, “We’re very confident that our current offering is competitive.”

Other executives jumped in to compare the two companies’ benefits.

“I don’t think they have a VEP at Meta by the way,” Cicconi said.

Pichai then asked, to some laughs from the audience, “Should we incorporate all policies of Meta while we’re at it? Or should we only pick and choose the few policies we like?”

“Maybe I should try running the company with all of Meta’s policies,” he continued. “No, probably not.”