SAN FRANCISCO (Reuters) - Internet search giant Google Inc is known for hosting the most extravagant holiday parties in Silicon Valley, often drawing crowds of over 10,000 and prompting some employees to post ads for party dates on classifieds Website Craigslist.

But even Google has decided to scale back its holiday celebrations this year due to a global economic downturn and an ever-expanding workforce that had grown to 20,000 in October, according to a person familiar with the matter.

Silicon Valley has few reasons to celebrate this year as companies, including Hewlett Packard Co, Yahoo Inc, Sun Microsystems Inc and Applied Materials Inc, have cut over 140,000 jobs in the last few months because of the bleak economy, according to Challenger, Gray and Christmas consulting group.

Google has fared better than most tech companies, but departments at the Internet company will have smaller events this year to encourage camaraderie between employees and celebrate more economically, said the source. Team holiday activities will include spending an afternoon volunteering followed by evening social activities such as dinner parties and museum outings in San Francisco.

This is a striking difference from previous years, when Google holiday parties included ice sculptures of the company's logo, virtual reality video game stations, karaoke booths, sushi buffets and burlesque dancers.

Last year a party crowd of 10,000 spread throughout the Shoreline Amphitheater, near Google headquarters in Mountain View, California, said workers -- called Googlers. A handful used the Web to find dates.

But this year only one looked for a companion in a recent search on Craigslist.

Google declined to comment on this year's change.