‘There Will be Blood in the Streets’: Google Execs Threaten Layoffs if Profits Don’t Come Up

After extending a two-week hiring freeze announced last month, the internet search engine giant is reportedly pressing its workers harder in an attempt to boost productivity. Employees who spoke with Business Insider said they have greater fears of harsh disciplinary action and that "everyone has been talking about the company tightening its belt.”

In a screenshot of a conversation shared with the outlet, Google Cloud sales executives threatened their employees, saying there would be an "overall examination of sales productivity and productivity in general" and that if next quarter results "don't look up, there will be blood on the streets."

In its second quarter earnings report last month, Google’s parent company Alphabet - a holding company for Google’s massive corporate empire - reported a 13% increase in revenues, but fell just short of their expected $70.8 billion, marking the fourth quarter in a row of a decline from the previous year. Alphabet also reported a modest decline in earnings per share and in operating margins, and net income fell from $18.5 billion in Q2 2021 to $16 billion, making for a 14% decline in profit and about $1.4 billion less than Wall Street expected, according to the Financial Times.

Still, according to the London-based paper, Alphabet CFO Ruth Porat told analysts that the company's second quarter performance was “solid” and explained away any shortcomings by pointing to a surge in demand in 2021, when millions more were working from home due to the COVID-19 pandemic-related lockdowns and other restrictions.

Google has faced a number of allegations of unfair treatment of its workers, and in June was forced to pay out a $118 million settlement on a class-action lawsuit alleging that women workers at Google are systemically underpaid.

The possibility of layoffs remains palpable across many of the internet giants, which have suffered a similar dynamic to Google during the pandemic, with Meta workers bracing for a possible culling of up to 10% of their workforce. Moreover, job losses are likely in the coming months as the US enters a recession and the Federal Reserve is likely to continue increasing interest rates in an attempt to quell inflation.

That inflation, in turn, is being driven mostly by profiteering, an April study by the Economic Policy Institute found. According to the think tank, corporate profits accounted for 54% of inflation over the last two years, meaning that companies increasing their prices because consumers expect price increases has made inflation caused by other issues, such as pandemic-related expenses, twice as bad as it otherwise would have been.

Defending Profits at Workers' Expense

Bank of America executives, looking out for their own profits, have said they would welcome such a development. A June note leaked and published earlier this month revealed the bank’s executives saying that “by the end of next year, we hope the ratio of job openings to unemployed is down to the more normal highs of the last business cycle.”

That company, too, saw its profits decline over the last year, including a 32% drop in earnings in the second quarter of 2022 compared to that quarter in 2021. However, thanks to rising interest rates, the company’s net interest income increased.

With official unemployment tiptoeing over recent months down to its present rate of just 3.5%, which is where it was before the March 2020 lockdowns that crashed the economy, workers have found new leverage to press for demands for higher wages and better working conditions - and the boldness to form labor unions when their bosses won’t agree. Both dynamics began earlier in the pandemic, as workers struggled for safer anti-COVID practices against employers who were unwilling to spend the necessary funds to keep their workers safe.

One unexpected arena of labor struggle has been the coffee shop giant Starbucks. Roughly 200 of its 9,000 shops have formed or joined labor unions in recent years, with just 40 voting against union representation. CEO Howard Shultz has been intransigent about refusing to recognize his workers’ unions, and recently threatened unionized stores with cuts to the benefits Starbucks has long used to lure in potential workers, including covering gender-affirming medical procedures for transgender people and helping to cover the costs of traveling to abort a pregnancy for employees who live in states where abortions are now banned.