Saturday, May 18, 2024

Microsoft Will Axe 10,000 Employees for Fear of Economic Gloom

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Microsoft is joining the gaggle of timid tech titans resorting to mass firings in the face of financial uncertainty—announcing in a securities filing on Wednesday that it plans to axe 10,000 employees, CNN Business reports.

These jobs account for five percent of the company’s global workforce and are being cut in response to “macroeconomic conditions and customer priorities.”

While it’s unknown how having 10,000 fewer workers is helpful to customer priorities, Microsoft CEO Satya Nadella hinted at the coming bloodbath at the World Economic Forum in Davos, Switzerland, implying that Microsoft did not have any better ideas for weathering a downturn in the global economy.

“No one can defy gravity and gravity here is inflation-adjusted economic growth,” he told WEF founder Klaus Schwab in a livestreamed discussion.

Nadella also put out a memo to staffers on Wednesday, letting them know that 10,000 of them would be jobless within the first two economic quarters of this year, citing the pandemic and his fear of recession.

“We’re living through times of significant change, and as I meet with customers and partners, a few things are clear,” he wrote. “First, as we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less.”

Microsoft may be the latest big name to make such cuts, but it’s not the first.

Salesforce recently announced that it would be dismissing ten percent of its workforce, and Amazon would similarly let go of 18,000 employees. Facebook parent Meta also cut 11,000 jobs, marking the most massive-mass firing in its history.

And it’s been a bad time to work in tech for a long time: According to a recent report from outplacement firm Challenger, Gray & Christmas, layoffs in the industry were up 649 percent in 2022 compared to the previous year, despite the fact that firings across the rest of the economy had only risen by 13 percent over the same period.

Despite the bad news for thousands, Nadella assured the employees—who apparently still don’t know which side of the chopping block they are on—that the corp “will continue to invest in strategic areas for our future.”

The CEO further lamented, “These are the kinds of hard choices we have made throughout our 47-year history to remain a consequential company in this industry that is unforgiving to anyone who doesn’t adapt to platform shifts.”

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