After Twitter, Meta, and a host of tech giants, Microsoft is preparing mass layoff due to uncertain macroeconomic conditions. As reported by The Verge, the company may fire 5 per cent of its workforce by this week. A Bloomberg report claims that the tech giant may announce layoffs as soon as today. Currently, Microsoft has over 220,000 employees, and 5 per cent roughly translates to 11,000. In October last year, Microsoft laid off close to 1000 employees across divisions.
The latest reports point out that the latest round of job cuts will majorly impact the engineering divisions. This comes just days after Microsoft announced an “unlimited time off policy” for its salaried employees in the US. As a part of the policy, US salaried workers won’t have a fixed number of vacation days and can take unlimited leaves for the same. This does not apply to part-time workers.
Although the news about the job cuts is unfortunate, the development isn’t entirely surprising as Microsoft has been giving signs of uncertainties ahead. For instance, its CEO Satya Nadella, who recently visited India, said in an interview with CNBC that Microsoft is not immune to global changes.
Nadella expects the next two years to be challenging for tech companies after the pandemic-fuelled growth. He also admitted that Microsoft is not immune and says the tech sector must look inwards to boost efficiency to remain competitive.
Microsoft is yet to confirm reports about a potential mass layoff this week.
Over the last five months, many American tech giants have fired thousands of employees to save operational costs. The companies have mainly blamed the Ukraine-Russia war, slow growth, and over-hiring during the peak COVID-19 pandemic.
Mass layoffs majorly began with Twitter in October, following Elon Musk’s formal takeover. The new Twitter CEO has taken strict measures to limit expenses. Twitter has fired over 3000 employees. Amazon laid off close to 10,000 workers late last year, and the company recently announced that more employees would lose jobs. This will take the total tally to 18000.
Meta, formerly Facebook, too, fired thousands of employees last year. It trimmed nearly 13 per cent of its workforce, which impacted more than 11,000 employees worldwide. Several other tech giants such as HP and Adobe also announced layoffs to save expenses.
In India, startups such as Dunzo and ShareChat have taken similar measures. Many companies have also ended their work-from-home and hybrid work.