I'm not sure the exact breakdown of their rewards, but baking a COL adjustment and a merit increase in a single number doesn't really count. Makes it way too easy to reduce pay increases.
... a refresh grant every year equal to 25% of a new hire grant for someone of your level vesting over 4 years, quarterly, with no cliff.
... a COL adjustment.
... a merit-based pay hike.
... a market adjustment if appropriate.
This is not a reduction in pay no matter how you slice it. It's going to be way more than 7%. It's going to be roughly 6.25% + 3% + 0-5%. 10-15% annually. 13-18% if they get the COL.
These are assessed relative to the market.
This is on top of your base pay, bonus, company bonus multiplier and vesting equity which has probably significantly appreciated year over year - potentially huge, as GOOG is up 37% YoY.
I'm not worried for the employees even though leadership didn't commit to making COL adjustments 6-7% this year instead of 2-3% like most years. It's a rounding error for these folks and there's no world in which they're getting a pay cut if they're meeting expectations.
Mostly it gives them the ability to effectively cut the pay of those whose performance they don't value, by giving them increases smaller than inflation.
Most FAANGs will just nuke them from orbit instead of trying to coax them out with a 3% raise instead of a 6% raise. Google may be an exception, I don't know, but you're not going to last long as a 'low performer' at Amazon (as today's LinkedIn post will attest) or Meta or Apple. They'll just tell you to pack your shit.
Google is famously slow at firing people. I’ve seen low performers scrape by for 18 months because managers were conflict averse and didn’t want to do anything.
I have a fear that my team where I work is going to go through more attrition this year because of a similar philosophy. We didn't get merit or COL increases last year, and I doubt they're gonna wanna go more than a few percent on COL this year. That's a huge effective pay cut.