Microsoft and Amazon begin layoffs

Like walking through a field of thorns after escaping from a giant pair of evil scissors, the cuts keep coming for the tech sector. Both Microsoft and Amazon began a round of layoffs yesterday – 10,000 workers and 18,000 workers, respectively – joining tech industry peers Meta, Alphabet, and Salesforce, who have also announced job cuts over the past few months.

And while each company is different, most are blaming their headcount reductions on macroeconomic conditions and the possibility of a future recession. Microsoft CEO Satya Natella, in an email sent to employees announcing the layoffs, said the company is seeing its customers cutting back on spending and working to “do more with less.” Amazon’s worldwide retail chief also mentioned uncertain economic times in a memo announcing the company’s cuts.

But there’s something else at play, too. Both companies scaled up headcount significantly to meet pandemic-era demand… and are now beginning to reorient themselves amid broader cost-cutting measures.

• Amazon added 310,000 jobs in 2021, one year after growing its workforce by half a million employees (it currently has ~1.5 million workers).
• Microsoft added 40,000 employees from June 2021 to June 2022, bringing its total headcount to 221,000 employees. The year before that, the tech giant added 18,000 employees.

💼📉 Zoom out: It’s not just the tech sector that’s sounding like a 2023 version of Jim Mora (layoffs?!). 61% of business leaders say their organizations will likely have layoffs in 2023, according to a newly-published report from Resume Builder.