In a county with more than 100,000 people looking for work and an unemployment rate above 11 percent since June 2009, Google has gone on a hiring spree, increasing the size of its global work force by nearly 2,000 people during the first six months of 2010.
While the pace of the search giant’s hiring hasn’t quite reached the boom years of 2006 and 2007, when its work force routinely grew by 15 percent each quarter, it stands in contrast to other Silicon Valley companies that are reporting big profits but adding little to the size of their work forces. Other valley companies, such as Cisco Systems and Intel, have also said they plan to increase their work force this year, but the percentage growth for those companies would be much less than the growth at Google.
The hiring growth, analysts say, reflects the increased competition Google faces as it tries to expand beyond paid search advertising that provides the bulk of Google’s revenues into new areas like smartphones and selling its online software services to businesses and government.
“There is no reason to fix what isn’t broken — their paid search business — but they need to have a few more arrows in their quiver,” said Rick Munarriz, a senior analyst at The Motley Fool. Google “really doesn’t know whether its biggest enemy now is Microsoft or Apple.”
Huge turnaround
From Jan. 1 to June 30, Google’s work force grew by 10 percent, a huge turnaround from 2009, when the number of Googlers shrank for the first time in the company’s 12-year history. But while Google says it is looking to hire several hundred people at its Mountain View headquarters, including engineers, product managers, lawyers, advertising sales people, communications experts and others, the Internet giant also is aggressively hiring engineers and advertising sales people around the world, from Boston to Santa Monica and from Accra to Zurich, on every continent except Antarctica.
Google is even hiring in China, despite its very public problems in the world’s largest Internet market this year. The company is also asking some of its senior software engineers and technical managers in Mountain View to consider relocating to Beijing or Shanghai, to work on products ranging from social networking to maps.
Google executives say the hiring is focused on four key areas — Internet search revenues, display advertising, development of its Android mobile software, and applications, such as Google’s online suite of word processing, spreadsheet and other office products.
Google’s global work force is now nearly 22,000 people. In recent securities filings, Google said it planned on “significantly increasing our hiring rate” through 2010, even if the hiring cuts into the company’s bottom line. Google is not saying how many workers it plans to add during the balance of 2010, or how many hires it plans to make in Santa Clara County, where the unemployment rate is 11.3 percent.
Part of Google’s aggressive hiring reflects increasing competition, including from Apple. With Android facing off against the iPhone and iPad, Apple has had a hiring surge of its own, boosting its work force by 7 percent or about 2,300 people in 2009. In search, Google is facing the deep-pockets combination of Microsoft and Yahoo.
The nearly 1,200 people Google added during the second quarter of 2010 included about 300 who joined through acquisitions including Google’s $750 million purchase of the mobile advertising company AdMob. The 5.7 percent jump in the company’s global work force was Google’s largest since the first quarter of 2008. That surge was one factor, analysts said, in the company narrowly missing second-quarter earnings expectations.
“Google knew they were going to come up light on the bottom line, yet they kept on hiring,” Munarriz said. “This is Google pretty much thumbing its nose at the market, saying, ‘We don’t have to please you quarter by quarter — we’re trying to build a company that will please you three to five years from now.’ “
Most jobs Google is trying to fill in Silicon Valley and elsewhere require a college degree, and often a master’s degree or doctorate.
Despite Google’s confrontation with the Chinese government over censoring its search results, Google still hopes to attract highly educated engineers and scientists to develop key technology in China. In Beijing and Shanghai, Google is trying to fill jobs for lead software engineers, technical team leaders, and even a computer research scientist position, according to job openings listed by the company.
Market share shrinks
Google has a tradition of encouraging its workers to spend time in its offices around the country and abroad to spread and invigorate the company’s culture. But some observers say Google also is facing personnel problems in China in the wake of its confrontation with the government that has caused it to lose search market share and advertisers.
“I think among the search community here, morale is relatively low,” said Mark Natkin, managing director of Beijing-based Marbridge Consulting, a market research firm that follows the tech industry in China.
Google said there has been “very little attrition” in its Chinese offices.
“Our leadership team in China has not changed. We have always said we intend to keep an engineering presence as well as a sales team, and we are looking to hire top talent for a variety of roles,” a Google spokesman said.
There is little indication that Google’s growth spurt through hiring and acquisitions is about to end. Indeed, Google kicked off the third quarter by announcing plans July 1 to buy ITA Software, an airline flight information software company, adding 500 more employees.
Mercury News staff writers Brandon Bailey and John Boudreau contributed to this report. Contact Mike Swift at 408-271-3648. Follow him at Twitter.com/swiftstories.
