Microsoft Corp, which is a leading tech giant from the USA, is now supposedly planning to lay off thousands of employees. Experts believe that the sectors that will be affected the most will be engineering and human resource.
If we look around, it seems that the US tech sector continues to encounter one trouble after another. We already have many companies, such as Meta Platforms and Amazon, that have already announced job cuts.
Part of the reason for these mass layoffs is slow consumer demand around the world. And this slow demand is driven by a weak global economic outlook and high inflation.
If we look at the bigger picture, these rumors of layoffs at Microsoft tell us that the environment for tech companies is getting worse.
According to a UK news source, Microsoft's plan involves cutting 5% of jobs across multiple divisions. And if we talk numbers, around 11,000 jobs will be cut from the tech company.
According to another source, multiple engineering divisions at Microsoft will be affected by the recent move. Similarly, there are also some reports that Microsoft will be cutting jobs at the recruitment center by one-third. When compared with the job cuts at Microsoft from last year, the recent job cuts of 2023 will be a lot bigger!
The statistics from June 30 reveal that around 221000 people were working for Microsoft as full-time employees.
For now, it seems that Microsoft wants to maintain its growth rate despite the decreased sales in devices, Windows, and other products/services.
Considering we are only a couple of weeks into 2023, the current outlook for Microsoft and the rest of the US tech stocks aren't looking good. And when we pair that with an increased chance of a recession around the world, the situation will get far worse!
And if we take this move by Microsoft as an indication, similar things could happen at Meta, Alphabet, and Amazon.