Android apps are sandboxed

FWIW, they're not sandboxed from google play services:

The Play Store Services process has access to your precise location at all times, the motion sensors, networks, hardware identifiers (including IMEI), contacts, passwords, the entire storage space, call logs, access to other apps’ data, and more.

Accordingly, google would have access to the Signal data on your phone. However, I don't know whether the encryption would provide a measure of protection against google. GrapheneOS by default does not use google play services, and provides a sandboxed version for people who need the functionality.

Someone at Google could hear what a device's microphone is picking up at all times?

I believe notifications would be accessible. Note that i don't mean the push notification backend mentioned by Doomerang, but the actual notification that goes into your status bar (which is all processed on device). That would be readable by the OS in theory.

I will leave just this info here

Technical Data

Subject of Investigation: Google Play Services
Number of Permissions: 277
Operating System: Android 4.4.2 and above

List of Permissions

3.1. Automotive Systems Control

Access to data and control of vehicle components via Android Auto/CarPlay:

• Power windows
• Tire pressure monitoring system
• Rearview mirrors
• Power system
• Mileage data
• Central door locking
• Driving mode management
• Seat adjustment
• Vehicle speed data
• Lighting system (headlights)
• Battery
• Climate control

3.2. User Interface Manipulation

• Embedding into application activities
• Application substitution
• Application icon modification

3.3. "Chimera" Component

System component of undetermined purpose.

3.4. SMS Management

Complete control of text messaging functions:

• Sending messages
• Receiving messages
• Reading messages
• Creating messages

3.5. Root-Level System Privileges

Complete device control at root-access level.

3.6. Application Data Access

• Access to all activities
• Ability to embed into activities
• Access to contacts

3.7. USB Management

Control of USB connections and data transfer.

3.8. Identifier Access

Access to all system and user device identifiers.

3.9. Screen Lock Management

Disabling keyguard (screen lock system).

3.10. Mail Services Access

• Access to email
• Access to voicemail

3.11. Network Function Management

• Enabling/disabling network interfaces
• Background data download
• Modification of network settings

3.12. Wi-Fi Management

• Access to saved Wi-Fi passwords
• Wi-Fi password transmission

3.13. Audio Recording

• Microphone audio recording
• "Capture audio hotword" function (keyword capture)
• Continuous audio stream monitoring for hotword detection

3.14. Geolocation

Complete control of location functions:

• Location determination by all available methods
• Independent enabling/disabling of geolocation services
• "Allocate aggressive" mode (aggressive resource allocation for location determination)

3.15. Payment Information Transmission

Sending payment data without specified recipient restrictions.

3.16. Camera Control

Access to device camera.

3.17. Telephony Function Management

• Making calls
• Access to call history
• Control of telephone connections

3.18. Permission Management

Manipulation of other applications' permissions:

• Permission backup
• Permission sharing
• Permission revocation
• Permission restoration

3.19. Device Lock Management

• Device locking
• Device unlocking
• Password protection bypass

3.20. Biometric Authentication

Complete control of biometric identification systems:

• Fingerprint scanner
• Facial recognition (Face ID)

3.21. Notification Management

Manipulation of system notifications:

• SMS notification substitution
• Call notification modification
• Messenger notification modification

3.22. Telephony Function Access

• Access to telephony module
• Call management

3.23. Bluetooth Management

Control of Bluetooth connections.

3.24. Security Key Management

• Encryption key substitution
• Password reset

Google Play Services is one of many pre-installed Google system components. A standard Android installation contains 30-50 additional Google applications with similar or complementary permission sets.

but the sandbox is controlled by google, of course. They might need to snoop on your app for "accessibility reasons" (no pun intended)