Microsoft joins the Layoff Trend in Tech Industry

Microsoft Corp is reportedly considering cutting around 5 percent of its workforce, or about 11,000 roles, according to sources cited by UK broadcaster Sky News. According to a Bloomberg report, the company plans to reduce the number of engineering divisions in fresh rounds of layoffs. This move makes Microsoft join other tech giants that have announced job cuts in response to slowing demand and a deteriorating economy.

Earlier in October, it was reported that Microsoft laid off under 1,000 employees across several divisions. Those cuts impacted less than 1 percent of the software giant’s workforce of more than 200,000. At the time, the company had said in July that a small number of roles had been eliminated and that it would increase its headcount down the line.

The company had 221,000 full-time employees, including 122,000 in the United States and 99,000 internationally, as of June 30, according to filings. However, the company is now under pressure to maintain growth rates at its cloud unit Azure, after several quarters of downturn in the personal computer market hurt Windows and devices sales.

The layoffs come as a grim start to the new year for thousands of tech workers. In less than a week into 2023, more than 30,000 workers had lost their jobs globally, nearly double the number of people laid off in December 2022. The data from the Layoffs Tracker indicated that a total of 30,611 people from 30 companies were fired in the first six days of January. Apart from Amazon, the list includes video hosting platform Vimeo, tech giant Salesforce, Crypto exchange Huobi and several others.

A significant portion of this statistic comes from Amazon.com Inc’s decision to lay off more than 18,000 roles as part of a workforce reduction. The Jeff Bezos-owned company has now surpassed the 11,000 cuts announced last year by Facebook parent Meta Platforms Inc.

Overall, the job cuts are a reflection of the ongoing challenges faced by tech companies as the world continues to grapple with the economic fallout from the ongoing COVID-19 pandemic. As businesses continue to adapt to the new normal, many must make difficult decisions to keep their operations running.

It is worth noting that Microsoft has not yet confirmed the reports of layoffs and it is unclear if the company will make an official statement regarding the matter in the near future.