Mountain View, California-based search engine giant, Google Inc. announced yesterday it would be closing three engineering offices and laying off 100 job recruiters.

The company says that the “state of the economy” is to blame, in a post made on their official corporate blog careful to add that they are “still hiring, but at a reduced rate.”

“Our first step to address [the state of the economy] was to wind down almost all our contracts with external contractors and vendors providing recruiting services for Google. However, after much consideration, we have with great regret decided that we need to go further and reduce the overall size of our recruiting organization by approximately 100 positions,” said Laszlo Bock, Vice President of People Operations in the blog.

Analysts note that this is the first time Google has had to layoff long-term employees, citing what appears to be Google’s first period of reduced growth.

Google also announced via their blog that they would be relocating many of their employees from their Austin, Texas; Trondheim, Norway; and Lulea, Sweden offices, and shutting down the offices. “Our strong desire is to keep as many of these 70 engineering employees at Google as possible. However, we do recognize the upheaval and heartache that these changes may have on Google families, and that we may not be able to keep 100% of these exceptional employees,” said Alan Eustace, Senior Vice President, Engineering & Research.

Finally, in the last sweep of downsizing operations - Google will be eliminating a number of their products, a count which has ballooned since their IPO and now sits somewhere around 150. The official list of products which will be discontinued includes Google’s Dodgeball, the AJAX editor Mashup, video uploading at Google Video (but not YouTube, of course), the out-of-date Google Catalog and there will be no new development on Google’s Notebook.

“Starting next week, we plan to stop active development on Google Notebook. This means we’ll no longer be adding features or offer Notebook for new users.”

Google shares closed Thursday at $298.99, with a 52-week high of nearly double that this time last year.

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