Microsoft To Cut 11,000 Jobs. Human Resource, Engineering Divisions To Be Affected: Report

Microsoft is planning to cut five per cent of its workforce, especially in the human resource or engineering division, according to reports.

Microsoft is likely to lay off 11,000 jobs which could mean that the tech sector may continue to shed jobs.

New Delhi: Microsoft Corp is planning to cut five per cent of its workforce, especially in the human resource or engineering division, reports said. The latest job cut comes after technology companies like Amazon.com Inc and and Meta Platforms Inc announced retrenchment exercises in response to slowing demand and a worsening global economic outlook.

Microsoft is likely to lay off 11,000 jobs, news agency Reuters reported citing media UK broadcaster Sky News. "From a big picture perspective, another pending round of layoffs at Microsoft suggests the environment is not improving, and likely continues to worsen," American financial services firm Morningstar analyst Dan Romanoff said.

The company aims to slash jobs in a number of engineering divisions, the report quoted Bloomberg News while it could sack recruiting staff by as much as one-third, according to the Insider.

The cuts will be significantly larger than other rounds in the past year. While the exact date of the lay-offs isn't known but a source told The Verge that the company is expected to announce the decision on Wednesday, ahead of its quarterly earnings next week.

As of June 30, Microsoft had 221,000 full-time employees, out of which 122,000 are in the United States are in other countries, according to the news agency.

With the downturn of personal computers which hurt the company, Microsoft is now under pressure to maintain growth rates at its cloud unit Azure. A small number of roles were eliminated last year when Microsoft laid off about 1,000 employees across several divisions.

This also comes after Microsoft CEO Satya Nadella in an interview with CNBC said there will be "two years of challenges ahead for the tech industry".

"The combination of pull-forward and recession means we will have to adjust and will cycle through the demand cycle and, in fact, come out of it with what can be another massive growth cycle for the tech industry", Nedella told CNBC.