A globally-renowned tech firm, Microsoft has announced that it is laying off 10,000 employees from its service, the Times of India has reported.
The firm’s CEO, Satya Nadella in a letter issued to employees on Wednesday, cited the global economic downturn that has affected thousands of businesses across the world.
He said that the layoff would come in batches, until the end of March 2023.
Nadella added that Microsoft will spend $1.2 billion to clear among other obligations, the severance packages of the affected employees.
He also stated that while the firm was letting some of its staff go, it would not put an embargo on hiring into ‘key strategic areas.
“We’re living through times of significant change, and as I meet with customers and partners, a few things are clear,
“First, as we saw customers accelerate their digital spending during the pandemic, we’re now seeing them optimize their digital spending to do more with less.
” We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one. At the same time, the next major wave of computing is being born with advances in AI, as we’re turning the world’s most advanced models into a new computing platform.
“This is the context in which we as a company must strive to deliver results on an ongoing basis while investing in our long-term opportunity.”
“First, we will align our cost structure with our revenue and where we see customer demand. Today, we are making changes that will result in the reduction of our overall workforce by 10,000 jobs through the end of FY23 Q3.
“This represents less than 5 percent of our total employee base, with some notifications happening today. It’s important to note that while we are eliminating roles in some areas, we will continue to hire in key strategic areas.
“We know this is a challenging time for each person impacted. The senior leadership team and I are committed that as we go through this process, we will do so in the most thoughtful and transparent way possible.
“We are committed to ensuring all those whose roles are eliminated have our full support during these transitions. US-benefit-eligible employees will receive a variety of benefits, including above-market severance pay, continuing healthcare coverage for six months, continued vesting of stock awards for six months, career transition services, and 60 days’ notice prior to termination, regardless of whether such notice is legally required. Benefits for employees outside the US will align with the employment laws in each country.
“These decisions are difficult but necessary,” he said.
