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This is such a bizzare take. If a company was looking to cut costs, why would it start anywhere else but the largest and most expensive part of the business?
by unmole 4y ago
This is such a bizzare take. If a company was looking to cut costs, why would it start anywhere else but the largest and most expensive part of the business?
- jmyeet 4y agoSo at the end of 2022, Google apparently had 190,000 FTEs. The 2022 FY income statement lists revenue of $238B and cost of revenue of $126B. Those costs aren't really broken down so we have to guess. According to [1] the median employee compensation in 2021 was $296k. Now that's not a mean and it also isn't speific about what's included (eg perks, health insurance, retirement savings, food, etc). Once you factor in office space an average of $350k/employee as a baseline cost probably isn't too far off the mark. At 190,000 employees times $350,000 that's a cost of $66.5B/year, which is more than half of the cost of revenue. Labor is the biggest expense. It also echoes "investor" concerns about how the cost of revenue is rising faster than revenue is increasing (ie lower profit margins). Or what are you arguing is a bigger cost? [1]: https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/alphabet-retains-top-median-employee-salary-hits-lowest-ceo-pay-gap-in-tech-71896693 https://www.spglobal.com/marketintelligence/en/news-insights...
- deleted 4y ago[deleted]
- unmole 4y agoI don't understand. You agree that labour is the biggest expense. So why do you think it's bizzare that companies trying cut costs are laying off people?