Microsoft Makes History: First Voluntary Layoffs in 51 Years Amid AI Push

Microsoft is implementing its first-ever voluntary layoff program, offering it to approximately 7% of its U.S. workforce. This unprecedented move in the company's 51-year history comes as the tech giant faces challenges related to its workforce amidst significant investments in artificial intelligence (AI). Employees with a combined age and years of service totaling 70 or more are eligible for the program, which affects over 8,000 employees out of a total of 125,000 American workers. Amy Coleman, Microsoft's HR director, stated in a memo that the program aims to provide these long-tenured employees with the "choice to take that next step... with generous support from the company." The decision follows the layoff of over 15,000 employees last year and coincides with the company's commitment to spend $140 billion on capital investments in its fiscal year ending in June. Microsoft has not commented on the matter. Other tech groups, including Amazon, Oracle, and Meta, have also conducted mass layoffs since last year, citing the need to streamline their teams. These groups have increased spending on AI, shifting resources from other parts of their businesses. Job cuts linked to AI have become a growing trend in the American job market, raising concerns about technology's impact on employment. The fintech group Block even cut "nearly half" of its workforce, stating that AI could fill the lost functions. Microsoft's stock has dropped about 14% this year, underperforming several competitors