Class A office space in Manhattan is about $70/sqft, and the average office employee gets 150 sqft allocated (desk, hallway, conference room, supply closets...) Google is probably 170. That's $11900 annually that they save by not having an employee take up office space.
No, it's not fungible on a small scale, but it's certainly fungible on a large scale: reduce your office needs by 100 people and you can rearrange desks and sublet that 17000 sqft.
Google has other famous in-office benefits that cost per-person, so $12K per remote is a baseline savings. If Googlers had any collective bargaining power, they wouldn't be getting salary reductions: they would be getting extra expense money for desks, chairs, and ISP upgrades.
No, it's not fungible on a small scale, but it's certainly fungible on a large scale: reduce your office needs by 100 people and you can rearrange desks and sublet that 17000 sqft.
Google has other famous in-office benefits that cost per-person, so $12K per remote is a baseline savings. If Googlers had any collective bargaining power, they wouldn't be getting salary reductions: they would be getting extra expense money for desks, chairs, and ISP upgrades.