The first sign of the downsizing fever was seen last week when Google announced to shut down 5-month old service: Lively. Now it is said that Google may be preparing to cut thousands of jobs. Probably as much as 10,000 workers (and counting) will no longer enjoy the air of Googleplex.

In fact, according to internal source, Google has been quietly fired hundreds of employees in the past few months without reporting to Securities and Exchange Commission (SEC) or publicizing the layoffs that appears being required by law.

Google has managed to avoid the legal requirement by classifying a number of the employees as “temporary operational expenses,” which means their positions are not official and could be eliminated without public notification. These employees were hired without full time benefits such as health coverage and insurance too, yet ironically many of them have been working there for five or even seven years.

“Google has hundreds of lawyers figuring out how not to get caught,” said Daya Baran, WebGuild President. “One of them is by moving workers from job to job every few months so that their status remains temporary. That is why you probably have never spoken to the same person twice at Google and that is also why there is somebody new on the job and most times you know more about their job than they do,” he supposed.

Google’s most recent filling with SEC shows only 20,123 employees being officially hired. But if counting the contractors the number comes out closer to 30,000, and this means the layoffs would cut about 33 percent of its staff in comparison to 10 percent cut by Yahoo announced recently when Yang planned to step down.

Without doubt, the economic downturn is hitting Google hard and with the slowdown in online advertising, the downsizing fever seems just begin getting heat