Microsoft to Reportedly Offer Buyouts to 60,000 Employees in AI-Era Cost Cuts

Microsoft announced that it would offer buyouts to 60,000 employees in an effort to reduce costs amid the rising use of artificial intelligence, according to reports. The move was described as the latest example of how AI is reshaping tech companies and the greater workforce.

This is the latest of several cuts Microsoft has made to its workforce this year. The company announced in April that it was offering voluntary retirement to about 7% of its US workforce, which consisted of about 125,000 employees at the time. Its global workforce is made up of about 223,000 workers globally.

Some of Microsoft’s most recognizable divisions, including Xbox, Windows and Copilot, its AI tool, will be participating in the offer, according to a Bloomberg report on Monday. Employees in certain divisions, including cybersecurity, datacenters and marketing, would not be eligible, it said.

Amy Coleman, Microsoft’s executive vice-president and chief people officer, said in a statement that the offer gives eligible employees who may be considering a future outside the company a new choice to make that transition now with support, and that it also gives participating organizations another way to adapt their workforce to changing needs. The company did not respond to a request for comment on further details about the offer.

Multiple tech companies have announced layoffs due to the rise of AI and increased investment in the technology this year. Meta announced plans in April to cut 10% of its personnel, or about 8,000 employees, to boost efficiency; Amazon has made several cuts, most recently in its retail division; and in June, Oracle shed its workforce by nearly 13%, cutting 21,000 jobs, as a result of AI. But it’s unclear whether these workforce-reduction measures have translated yet into greater efficiency. A recently published National Bureau of Economic Research working paper found that among the 9,000 senior executives it surveyed from around the world, 90% said AI had yet to result in greater productivity at their companies.