Google giving 10% raises to workers

By Dow Jones Newswires-Wall Street Journal
Posted Nov. 10, 2010 at 11:15 a.m.

Moving to staunch the defection of staff to competitors, Google Inc. is giving a 10 percent raise to all of its 23,000 employees, according to people familiar with the matter. The raise, which will be given to executives and staff across the globe, is effective in January.

The pay hike comes as Google ramps up its battle with competitors, especially neighboring Facebook Inc., in a fight to secure talented staff. Roughly 10 percent of Facebook’s employees are Google veterans, and other Silicon Valley companies have aggressively poached employees from the Internet giant.

Chief Executive Eric Schmidt disclosed the raise in an email to employees, saying the company wants to lift morale. “We want to make sure that you feel rewarded for your hard work,” Schmidt wrote. “We want to continue to attract the best people to Google.”

Schmidt wrote that company surveys indicate salary is more important to Google employees than any other component of pay, such as bonuses or equity. He added the company was moving a portion of employees bonuses into their base salaries, so they would receive some of it in every paycheck.

A Google spokesman declined to provide details. “While we don’t typically comment on internal matters, we do believe that competitive compensation plans are important to the future of the company,” he said. The raise was previously reported by the Silicon Alley Insider blog.

The across-the-board raise comes after Google last month posted strong third-quarter results. But it will also prompt concerns on Wall Street about Google’s expenses.

BGC Partners analyst Colin Gillis said the sweeping raise will clearly impact profit margins, and the decision highlights how important staff retention has become to the company.

Over the past year several former Google executives who helped run the company’s advertising business, as well as Google product managers and engineers involved in its Chrome and Android software projects, joined Facebook.

The raise isn’t the first time Google has taken steps to retain employees. In 2009, it repriced millions of employee stock options whose value had been wiped out as Google’s share price fell between 2007 and 2009. The stock has since recovered and closed nearly unchanged Tuesday at $624.82.

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  1. MaryMary Nov. 10, 2010 at 11:43 a.m.

    Google paid only 2 percent taxes on its profits due to hiding money in offshore accounts. Another corporate welfare program.

  2. Wayne A Milczarek II Nov. 10, 2010 at 12:24 pm


    According to Google’s 2009 annual report they stated the following tax rates:

    2007 25.9 % 2008 27.8 % 2009 22.2 %

    What basis do you have for saying Google is paying 2% taxes by hiding money offshore? I believe your statement is inaccurate and meant to incite anger directed toward a successful US corporation.

  3. MaryMary Nov. 10, 2010 at 1:15 pm

    Wayne please see Bloomberg news and I suppose you can google double irish tax shelter. I repeat corporate welfare.

  4. STeveB Nov. 10, 2010 at 1:21 pm

    If the information is factual, then why aren’t you questioning Obama’s administration on what they are doing about corporate taxes? Provide the proof or shut up.

  5. MaryMary Nov. 10, 2010 at 1:29 pm

    Steve why arent you questioning the corporations as to why they are not paying their fair share instead of taxing the middle class to oblivion.

  6. Michael Nov. 10, 2010 at 1:42 pm

    Google paid 2% on FOREIGN profits. Mary needs to learn to read past the headlines. Also, she should look up the definition of “effective tax rate” while she’s at it. But that would presumably detract from her liberal blathering.

  7. MaryMary Nov. 10, 2010 at 2:05 pm

    Michael its still income shifting to get out of paying their fair share of taxes here in the US. Google is not the only one doing this. 60 billion lost in US taxes. But then I suppose you are ok with this and they could tax you more. Corporate welfare. Socialize the losses and privatize the gains.

  8. Michael Nov. 10, 2010 at 2:34 pm

    Google has no losses, hence no social welfare, and yes, I’m quite OK with minimizing all amounts flowing from private individuals and corporations to state and federal governments. Unfortunately for the integrity of your argument, the tax management strategies Google engages in are perfectly legal. I only wish that I had the option to do the same.

  9. Mikey Bottoms Nov. 10, 2010 at 2:34 pm

    I think the state of IL should pay Google $10M to make sure they stay in our state. We’ve done it for US Cellular and Groupon. Why not Google too?

  10. MaryMary Nov. 10, 2010 at 2:49 pm

    Michael I guess you are missing the whole point here. The rich do not in fact pay their fair share even if it is legal. You my dear sir as an individual will never be able to do this. But alas I guess its true what they say that the republicans have brainwashed people to vote and think against their own best self interest. Arent you the least bit outraged by this? But Im sure your outraged when you hear about healthcare for all.

  11. Michael Nov. 10, 2010 at 3:13 pm

    Liberals exist in a perpetual state of outrage, like children, which makes it difficult to take them seriously, especially when their rationale for their incessant upset is “it’s not fair!” (a common complaint among children). I look after my own self-interest, and I urge you to do the same instead of mewling about what rich people owe you. It’s never too late to take responsibility for your own life, Mary. Nose to the grindstone now, dearie. That meatloaf won’t make itself!

  12. MaryMary Nov. 10, 2010 at 3:31 pm

    Yes and Glen Beck and Rush Limbaugh are like mewling little kittens never outraged, as usual your hypocrisy superceeds your intelligence. Yeah yeah mine all mine thats your self interest.

  13. Michael Nov. 10, 2010 at 4:12 pm

    It’s “supersedes,” Mare-mare, but you’re probably too outraged to spell correctly. Keep holding your breath and stamping your feet. Your daddy Obama will be back from Asia soon to rub your temples and give you money that other people have earned.

  14. MaryMary Nov. 10, 2010 at 4:37 pm


  15. Aaron Nov. 14, 2010 at 9:00 a.m.

    Michael, it’s terribly cynical to live in a world where power trumps justice, when we are supposed to be a nation of laws, not men. Sometimes those whining children have good reason to complain. Parents are not angels.