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Report: Google slowing down hiring, applying stricter rules to company spending


The Wall Street Journal reports that Google is tightening the reigns when it comes to hiring and spending as a company. The report, citing venture capitalists and others familiar with the matter, claims that new Chief Financial Officer Ruth Porat is spearheading the streamlining of the company. Portat is allegedly involved in an internal audit of the company, examining costs, revenue, and accounting systems.

One sign of Google’s curbed hiring efforts comes with its Q1 2015 hiring data. The company hired 1,819 employees during the quarter, which is less than its average of 2,435 hires per quarter. Google executives are reportedly now selecting which groups can hire new employees, based on strategic priorities. For instance, hiring at Google+ has been stalled, while Nest has been given more leeway to grow.

Other instances of Google’s increased focus on watching where money is going come in the form of travel, supplies, and events all requiring more justification and additional approval than they previously did.

These cuts are not to say that Google is struggling, however, only simply slowing down and ensuring that they are investing in the right areas:

Google is a long way from cutting jobs and the company is still growing. But the scrutiny on expenses is a significant change for a company that long favored expansion and experimentation over bottom-line concerns.

“Google is taking the foot off the gas,” said Carlos Kirjner, an analyst at Bernstein Research. “I don’t think the company has fundamentally changed its philosophy or approach. It has just adjusted.”

Google revenue grew 19% in 2014, down from 21% in 2013, 22% in 2012 and 29% in 2011. Its operating profit margin has also fallen to 32%, from 38% in 2011.

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Avatar for Chance Miller Chance Miller


Chance currently writes for both 9to5Google and 9to5Mac, in addition to 9to5Toys.