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Microsoft and Alphabet announce job cuts as spending slows 

For many tech companies, business was booming during the pandemic due to the rise of remote work and increases in other types of online activity. 

Between June 2021 and June 2022, it’s estimated that the tech workforce grew by 40,000 to 221,000 full-time employees. However, as the industry has slowed in the last year, many have embarked on a series of job cuts, with some tech firms cutting thousands of positions.

Microsoft and Alphabet are two of the latest tech companies to announce job cuts, with Microsoft announcing 10,000 job losses and Alphabet – the parent company of Google – announcing that it will be cutting 12,000 positions across its departments. 

In a memo, Google and Alphabet CEO Sundar Pichai said that the cuts will affect 6% of the company’s workforce in different teams, including engineering and recruitment. 

The CEO wrote: “While this transition won’t be easy, we’re going to support employees as they look for their next opportunity. Until then, please take good care of yourselves as you absorb this difficult news. As part of that, if you are just starting your work day, please feel free to work from home today.”

In Microsoft’s announcement, the company said that 5% of its global workforce would be affected by redundancies, with the CEO Satya Nadella writing that many parts of the world are currently in recessions, but “at the same time, the next major wave of computing is being born, with advances in AI”.

He also said that recruitment in key areas would continue and potentially grow, and experts say there is still demand in the industry for certain skills, including those with experience in data science and AI. 

However, in an interview, Kevin Poulter, an employment lawyer at law firm Freeths, warns “employees affected by these cuts may struggle to secure alternative work in light of similar reductions already announced across Meta, Amazon, Salesforce, and across the wider tech sector”.

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