The economic paralysis has been pushing several companies to take drastic measures. To cater to the prolonged slump in demand, Microsoft is also kicking out 10,000 employees, which is almost 5 per cent of its workforce. The CEO of the company Satya Nadella confirmed the same in a blog post.  

 “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 per cent of our total employee base, with some notifications happening today,” wrote Nadella. 

While Microsoft is biding adieu to some of its people, it also plans to hire others in “key strategic areas,” revealed the CEO.  “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,” he added. 

The tech giant is under a tremendous amount of pressure to maintain growth rates at Azure. The cloud unit has been continuously facing a downturn in the personal computer market hurting Windows and devices sales.

According to Satya Nadella, the company will provide full support to the sacked employees.”We will treat our people with dignity and respect, and act transparently. These decisions are difficult, but necessary. They are especially difficult because they impact people and people’s lives – our colleagues and friends. We are committed to ensuring all those whose roles are eliminated have our full support during these transitions,” he said. 

The tech giant that employs 221,000 full-time workers, is not the latest company to lay off workers. Several firms, including Meta, Amazon, Twitter, and Morgan Stanley, have been issuing pink slips to their workforce in response to slowing demand and a worsening global economic outlook.

The latest layoff by Microsoft is an indicator of eroding situation in the job market. In October, news site Axios reported that Microsoft had laid off under 1,000 employees across several divisions.

“From a big picture perspective, another pending round of layoffs at Microsoft suggests the environment is not improving, and likely continues to worsen," Morningstar analyst Dan Romanoff. 

Shares of Microsoft were marginally higher in late afternoon trading. The company is set to report quarterly results on Jan 24.