The company won’t be doing a company-wide pay raise to match rising prices. | Illustration by Alex Castro / The Verge
Google parent company Alphabet announced its fifth quarter in a row of record profits ($18.9 billion) and second straight quarter of record revenue ($65.1 billion) in October, but a company executive told employees that Google wouldn’t automatically adjust their salaries to account for inflation. According to CNBC, Google’s VP of compensation Frank Wagner told employees at a company all-hands meeting on December 7th that Google doesn’t “have any plans to do any type of across-the-board type adjustment” when asked about the inflation rate in the US.
Wagner did hint that the company’s compensation budgets “reflected” the higher cost of labor that comes with increased prices, according to CNBC. However, he said that the company would rather pay any increased wages based on performance rather than do an increase across the board.
While rewarding the top-performing employees more makes intuitive sense, it could also end up reinforcing people’s rankings — having to worry less about money means you can concentrate more on your work and even afford better quality time off to recharge. That rings especially true as Google expects 80 percent of its employees to spend at least some time in its offices (often located in cities with higher-than-average costs of living like Austin, New York, or San Francisco) when they end up returning.
Google declined to provide an on-the-record comment to The Verge, but told CNBC that base salary is just one part of its employees’ compensation, which also includes bonuses and stock. CNBC says the company also reiterated Wagner’s comments about pay increases being tied to performance.