Because of the nature of the roles or because they are selective to a fault? It's my experience that most people at a company of that size are "just there". If you have 2 employees, both of them have to be excellent. If you have 200 employees, 2 of them have to be excellent.
I agree, but I hear more stories from / about ex-googlers along the lines of: I have 20 years experience and 2 PhDs and they have me writing unit tests.
I think its likely hard to hire smart people who don't rock the boat; and thus it takes a long time to hire. It's of course possible (and reasonably likely) that there are only a handful of people that can do the work, but I dunno... with the kind of money that Google has you just open a school and start grooming people specifically for the roles that you have open. Build a pipeline of qualified workers, don't wait for them to come to you.