Microsoft moves to shed quarter of workforce
Microsoft is launching a voluntary exit program covering 60,000 employees, more than a quarter of its global staff, as the tech giant seeks to reduce payroll costs while increasing AI investment.
The US tech giant announced the program on Monday, covering roughly 27% of its 223,000 employees across selected divisions including Xbox, Windows, Copilot, finance, and human resources. The initiative follows thousands of job cuts earlier this year and comes as Big Tech companies seek to slash payroll costs while ramping up AI investment.
Microsoft has described the initiative as a voluntary exit program, under which employees can leave with severance packages. The company has not disclosed how many workers it expects to accept the offer.
Previous Cuts
The latest move follows several rounds of workforce reductions at Microsoft. In July, the company announced plans to eliminate 4,800 positions, including approximately 3,200 in its Xbox gaming division. It had already launched a voluntary exit program in April covering roughly 8,750 US employees, with around 30% reportedly taking the offer.
Industry Trend
The cuts come as Microsoft commits enormous sums to AI infrastructure, putting pressure on the company to remove other expenses. Other Big Tech giants have also been cutting jobs while pouring billions into AI. Amazon announced 16,000 corporate job cuts earlier this year, following another 14,000 layoffs in 2025.
Meta has also slashed jobs while ramping up AI investment, while Google has repeatedly launched voluntary exit programs to reduce its workforce. The trend has fueled concerns that AI could eliminate large numbers of jobs, particularly in administrative, technical, and other white-collar occupations.
Global Impact
The threat extends beyond the tech industry. The Netherlands announced plans to eliminate around 25,000 government positions by 2035, partly through AI adoption, to save €3.5 billion annually. Denmark has also announced plans to use AI to free up 50 million working hours annually by 2035, equivalent to roughly 30,000 full-time positions.
Microsoft co-founder Bill Gates has warned that AI could cause major upheaval in the labor market, while SpaceX CEO Elon Musk predicted that AI could surpass humanity's combined intelligence within five years, potentially escaping human control within a decade.
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