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Microsoft, Google, Amazon To Lay Off Employees Over Economic Challenges

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Tech Giant, Google, and Microsoft have announced plans to lay off thousands of their employees globally as part of broader cost-cutting measures and due to growing economic uncertainty.

Speaking before the layoff announcement at the World Economic Forum (WEF) in Davos, Switzerland, Microsoft CEO, Satya Nadella said “No one can defy gravity and gravity here is inflation-adjusted economic growth.”

In a memo to staffers Wednesday, Nadella also cited changing demand years for digital services years into the pandemic as well as looming recession fears.

“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 optimise their digital spend to do more with less.”

According to Madella, Microsoft had approximately 221,000 full-time employees globally as of June 30, 2022, according to a US Securities and Exchange Commission filing, with some 122,000 of those staffers based in the United States.

Nadella said the10,000 job cut represents less than five per cent of the company’s total workforce and the reductions will be complete by the end of its fiscal third quarter this year, which ends in March.

“These decisions are difficult but necessary,” Nadella wrote.

Google also announced that the company will lay off 12,000 employees globally. Google workers in the US who are affected have already received an email, while impacted staff elsewhere will be informed soon.

Speaking on the lay-off, in a letter to employees, Google CEO Sundar Pichai in a letter to employees said, “the company took a “rigorous review across product areas” to ensure that current roles are aligned with the company’s highest priorities.”

The letter by Pichai also highlights that the company will ensure a smooth “transition” for the impacted workers. Google will pay employees during the full notification period (minimum 60 days). It says that it would offer a severance package starting at 16 weeks’ salary plus two weeks for every additional year at Google. Entitled workers will also receive bonuses and healthcare benefits as per their contracts. On the other hand, Google workers outside the US will receive a severance package as per their contracts and local guidelines.

Pichai adds that Google will organise a town hall with employees on Monday. His letter reads, “As an almost 25-year-old company, we’re bound to go through difficult economic cycles. These are important moments to sharpen our focus, re-engineer our cost base, and direct our talent and capital to our highest priorities.”

Also, Amazon had announced that it plans to lay off 18,000 people and Salesforce, saying it was cutting 10 per cent of its staff. Facebook (FB) parent Meta also recently announced 11,000 job cuts, the largest in the company’s history.

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