Google pledges $7bn investment to create 10,000 Jobs in US this year

The planned investment is smaller than the $10bn it promised before the pandemic swept the country

Google plans to invest more than $7bn in the US this year and create thousands of jobs. AFP 

Google announced a $7 billion investment in the US that will create at least 10,000 new jobs this year, a drop from the $10bn it promised it would invest in 2020 before the pandemic swept the country.

The Alphabet's unit is investing in offices and data centers, including more than $1bn in its home state of California, Google chief executive Sundar Pichai said in a statement on Thursday. Part of the investment will be used for data center expansions in Nebraska, South Carolina, Virginia, Nevada and Texas, Mr Pichai said.

New York City Mayor Bill de Blasio said Thursday that Google plans to invest $250 million in its campus at Hudson Square. He also said the company, which employs 14,000 people in the city, will add 3,000 more workers. “The technology industry is doubling down on New York City,” Mr de Blasio said. “They know how much talent is here.”

In early 2020, Google said it would invest over $10bn into offices and data centers in a range of states, including California, New York and Texas. This was also a decline from the $13bn it pledged in 2019 to invest in order to expand in rural areas such as Nevada, Nebraska and Oklahoma.

However, in April last year Mr Pichai said Google would slow hiring for the remainder of 2020, “recalibrating the focus and pace of our investments in areas like data centers and machines.” Google had 135,300 staff at the end of 2020, and has said it will let employees work from home until July 2021.

Alphabet broke out figures for its Google Cloud business for the first time in February. The unit had an operating loss of $1.2bn in the fourth quarter, far behind its rival Amazon Web Services, the largest cloud provider, which generated fourth-quarter operating income of $3.56bn. For 2020, the cloud division lost $5.6bn, Alphabet said.

“An important element of our operating loss is that we have been building out our organization ahead of revenue, and that includes our product portfolio, the network of data centers,” Ruth Porat, chief financial officer of Alphabet and Google, said in an interview with Bloomberg Television. This will help the company pursue this large market opportunity, she added.

In 2020, Google’s services drove $426bn of economic activity for more than 2 million American businesses, nonprofits and other entities, the company said, citing its 2020 US Economic Impact Report.