In the months preceding its decision to lay off approximately 9,000 employees globally, Microsoft filed thousands of applications for skilled foreign worker visas, according to data from the United States Citizenship and Immigration Services (USCIS). The move has drawn fresh scrutiny over the company’s workforce strategy, particularly as the tech giant positions itself at the forefront of artificial intelligence investment.

The layoffs, announced on 3 July 2025, represent around 4% of Microsoft’s global headcount and come amid what the company describes as ongoing “organisational changes” aimed at preparing for “a dynamic marketplace.” This latest round follows job cuts earlier in January, May, and June.

According to USCIS data analysed by Newsweek and DailyMail.com, Microsoft had applied for 4,712 H1-B visas in the 2025 fiscal year. Some estimates circulating among former staff and industry insiders on social media platforms suggest the true number could be closer to 6,000 applications, although this figure remains unverified by official records. In the 2024 fiscal year, Microsoft submitted 9,491 H1-B visa petitions—placing it among the top ten US companies employing skilled foreign labour.

The H1-B visa programme allows US-based companies to employ graduate-level workers in speciality occupations such as IT, engineering, and finance. These visas are typically tied to specific roles, and visa holders risk losing legal immigration status if they are laid off or change employers.

Corporate restructuring raises concerns

Microsoft’s recent restructuring has not significantly reduced overall headcount—the company still employs over 220,000 people globally—but the layoffs have primarily affected long-serving employees across divisions, including sales, engineering, and support roles.

In its official statement, Microsoft said: “We continue to implement organisational changes necessary to best position the company and teams for success in a dynamic marketplace.” However, the juxtaposition of workforce reductions with a high volume of foreign worker visa applications has prompted criticism from labour advocates, policymakers, and segments of the public.

Steven Camarota, Director of Research at the Center for Immigration Studies, told Newsweek: “The actual data we have never supports the idea that we are terribly short of workers in the way that the business community says. You have a situation where the use of guest worker programmes is entirely disconnected from the actual behaviour of businesses.”

AI investment and efficiency drive

Microsoft’s workforce changes are taking place in parallel with its aggressive push into artificial intelligence. The company has invested tens of billions of dollars into AI research, including through its partnership with OpenAI, and continues to shift internal priorities to reflect this transformation.

Earlier this year, Microsoft said it would outsource more of its small and mid-sized business sales operations to third-party vendors. The company’s CEO, Satya Nadella, has consistently highlighted AI as a “once-in-a-generation opportunity” to redefine productivity and reshape business models.

But as AI adoption accelerates, traditional roles are being eliminated or redefined—especially in support functions and middle management. Critics argue that while AI may increase productivity, it is also enabling corporations to quietly reshape their workforces, often without public attention to the impact on domestic workers.

No proven link—but hard questions remain

Microsoft has not commented on any direct connection between its recent layoffs and its H1-B visa applications. And there is no indication of wrongdoing; companies are legally allowed to sponsor foreign workers while undergoing layoffs, provided compliance requirements are met.

Still, the optics of seeking thousands of skilled visa approvals while letting go of experienced domestic employees has touched a nerve—particularly in an election year when immigration, tech sector ethics, and job security are politically sensitive topics.

Microsoft's profits remain robust. The company posted $26 billion in earnings in Q1 2025 alone, and its stock is up nearly 20% year-to-date. But this financial strength contrasts sharply with employee anxieties over stability and long-term roles in a rapidly changing corporate environment.