A pedestrian walks on the Google campus in Mountain View, California on January 27, 2022.
David Paul Morris/Bloomberg via Getty Images
Bonus change resolves 2023 uncertainty
Google employees eligible for the bonuses will receive 80% of the sum in January, with the rest coming in March or April, according to a rating obtained by CNBC. This deviates from Google’s usual practice of delivering full checks in January. A Google spokesperson said it had “widely” communicated the change.
Google announced on Friday that it dismiss around 12,000 people.
It’s not the only company to adjust or cut bonus payments this year.
Goldman Sachs would have reduced its bonuses for junior bankers by up to 90%. The investment bank at the beginning of the month announced job cuts for up to 3,200 employeesi.e. 6.5% of its workforce.
Across all sectors, small businesses cut 2022 premiums by 9.7% to an average of $526, from $582 in 2021, according to Gusto, a payroll provider. They fell the most – by 10.7% – among financial companies, law firms and others in the “professional services” category.
“As companies prepare for what 2023 holds in store for them, they have handed out smaller year-end bonuses to close out 2022,” said Luke Pardue, economist at Gusto. wrote in a recent analysis, alluding to a uncertain economic outlook for the coming year.
Bonuses – and tax refunds – are not a guarantee
The timing and amount of year-end bonuses is generally not a guarantee – as companies have shown recently. And that means workers shouldn’t spend money they expect to receive but don’t yet have.
“Companies are so variable in how they determine and pay bonuses,” CNBC member McClanahan said. Advisory Board.
Waiting for a windfall to land in your account to spend it might seem logical — yet many workers fall into the trap of overextending themselves, she said.
More often than not, tax refunds are a bigger issue than bonuses, with people thinking they’ll get a bigger government check than what’s ultimately paid during tax season, McClanahan said.
Tax period for individuals starts January 23. About 30% of Americans say they will count on a windfall of tax refunds to make ends meet, according to a recent Credit Karma survey. Yet the IRS warned taxpayers that repayments could be lower in 2023 now that many pandemic-era tax breaks have expired.