Microsoft cuts 1% workforce amid recession fears; Google goes slow
Microsoft recently joined the list of global tech giants in cutting jobs even as an economic downturn looks evident amidst rising uncertainty in the financial markets.
The Bill Gates-founded company claims it is “realigning business groups and roles as usual” at the close of the US financial year (on June 30) and will eventually “start increasing its headcount”.
The Redmond, Washington-based company stated that it has sacked less than 1% of its 180,000-person workforce across segments spanning consultation to customer relations and partner solutions segments across geographies. Recently, Microsoft has also slowed down hiring in the Windows, Teams and Office groups as well.
Microsoft issued a statement following the realignment. “Today, we had a small number of role eliminations. Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly. We will continue to invest in our business and grow headcount overall in the year ahead,” the company stated in an email.
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While it is cutting down on staff strength, Microsoft has gained financial strength in the third quarter (Q3), with a 26% year-over-year increase in cloud revenue and overall revenue of $49.4 billion. However, in June, the company revised its Q4 revenue, citing the effect of foreign exchange fluctuations.
The tech sector has slowed hiring while also laying off the existing employees, as investors hold back fearing recession.
Oracle may go for a $1 billion cost-cutting which may include job loss for thousands of employees.
Google CEO Sundar Pichai recently said the global giant plans to slow hiring for 2022 mainly because of an impending recession.
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Instacart Inc. declared layoffs, followed by Tesla Inc. announcing a 10% salary cut for its salaried workforce. Meta Platforms Inc. also reduced its hiring plans because of concerns over economic conditions.
At a time when big tech companies are struggling to maintain their workforce, startups, mainly those in capital-intensive businesses like delivery, events and fintech, too have to suffer as funding dries up.
