Google's new cost-cutting strategy: "Core" team lays off 200 people, some positions moved to India and Mexico

According to reports, Google laid off at least 200 employees from its "Core" unit before announcing its financial results at the end of last month, and plans to transfer some positions to India and Mexico.

According to information on Google's website, the "Core" unit is responsible for building the technical foundation of the company's flagship products and protecting user information security. The core team includes information technology, Python development team, technical infrastructure, security foundation, application platform, core developers, and various engineering roles.

Google documents show that at least 50 engineering positions have been cut at the company's office in Sunnyvale, California, with many "Core" units recruiting corresponding roles in Mexico and India.

Asim Husain, Vice President of the Google Developer Ecosystem, announced the layoff news to his team via email last week. He also spoke at a staff meeting, calling it the largest layoff plan for his team this year. In the email, he wrote, "We plan to expand in locations with high labor growth while maintaining our current global business scope, so that we can be closer to partners and developer communities."

Since the beginning of last year, Google's parent company Alphabet has been reducing its workforce, with the company announcing plans to cut about 12,000 jobs, or 6% of its total workforce, mainly due to a downturn in the online advertising market. Despite a recent recovery in the digital advertising business, Alphabet continues to lay off employees this year. Ruth Porat, Chief Financial Officer of Alphabet, announced in mid-April that the company's finance department would be restructured, involving layoffs and relocating some positions to Bangalore, India, and Mexico City. Prabhakar Raghavan, head of the company's search business, told employees at an all-hands meeting in March that Google plans to establish teams closer to users in key markets such as India and Brazil, where labor costs are lower than in the United States.

It is understood that the "Core" team is crucial for Google to develop tools, and Google is streamlining its development tools to incorporate more artificial intelligence features into its products. Alphabet is preparing for its annual developer conference Google I/O on May 14, where the company typically unveils new development products and tools from the past year.

Hussein explained in a memo on developer changes that generative AI is at a "turning point," with recent industry advances in generative AI, including Google's Gemini, changing the nature of software development as we know it.

The layoffs in the "Core" team also include the Governance and Data Protection group, which will be at the center of the regulatory challenges the company faces, especially as global legislators pay increasing attention to the development of AI. In another email, Pankaj Rohatgi, Vice President of Security Engineering at Google, told his team, "To optimize our business goals, we are expanding work to other locations, which will result in some roles being cut or planned for reduction." Google's A-shares rose by 1.68% on Thursday, closing at $166.62.