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points by pseudosavant 3 days ago | 0 comments

They are making $600k in net income per employee. 10+ years ago, I'd never seen a mass layoff at any company making that kind of money per employee.

Their net income is up more than 2x in just the last 5 years. 10 years ago, Microsoft only had $85B in revenue, now they are up to $134B in net income, and they need to let 25% of the company leave?

[–] pseudosavant 3 days ago

I'll also note that the 25% didn't include anyone VP or higher. So, the most expensive employees aren't being shown the exit, just the people doing the actual work.

[–] gnabgib 2 days ago

It includes up to (and including) VPs, but not higher. If you read the comments (from former employees) on HN in the last couple of days, morale wasn't high/people weren't busy.

[–] upupupandaway 2 days ago

It absolutely included VP and higher. All levels up to 70.

[–] pseudosavant 1 day ago

I didn't realize that from the article I read (not this paywalled one). I guess there is more equality in how they are spreading around the slaps in the face.

[–] hibikir 3 days ago

If I have a team of 20, making a lot of money, but I think I can do the exact same job with 15 because of AI productivity gains, should I keep the other 5 employed for the vibes?

The total net income doesn't matter: The move is management saying they are overstaffed for the work they think they need.

Assume Microsoft is expecting just a third of people to take the offer. It's just too many people to want to move to a different division that needs more labor: It's basically entire divisions that they'd have to create from whole cloth.

[–] panta 3 days ago

> If I have a team of 20, making a lot of money, but I think I can do the exact same job with 15 because of AI productivity gains, should I keep the other 5 employed for the vibes?

yes, because, (a) you would be an amoral company otherwise and (b) the productivity and work quality of those remaining 15 will plummet if you don't and AI won't save you in the end: you'll build faster and cheaper, but the quality of your products will enter a downward spiral it will be hard or impossible to exit from.

[–] redwall_hp 3 days ago

Companies should also be legally barred from hiring for three years if they engage in layoffs. Mergers should also be off the table for the same period.

It's deleterious to the economy. As the recent Microsoft game studio apocalypse shows, mergers are also extremely deleterious. It would be better to have a dozen game studios employing people and competing rather than one shit company cutting expenses and reducing products going to market.

[–] apple4ever 3 days ago

> Companies should also be legally barred from hiring for three years if they engage in layoffs.

I like this. I was trying to think of some way to allow layoffs for struggling companies but not reward layoffs for companies that are making a profit, who just want to make more. My idea was more around the executive team being unable to take a salary or having to fire the CEO or something, nothing which as I worked through in my head seemed workable.

[–] cute_boi 2 days ago

The problem is there will always be country or states that won't follow such rule. And M$ will figure out how to hire people there...

[–] OnlineTux 3 days ago

In some places, if an employee is made redundant the employer is barred from filling the same position for a period of time.

Enforceability is a problem; it's always been trivial to re-write a job description.

[–] RivieraKid 3 days ago

Why amoral? If a an employee costs the company more than they make, it means the owner of the company is essentially donating his money to the employee. Is it amoral to not do that? What if the owner wants to donate the money to cancer research instead?

[–] panta 3 days ago

To expand on this, a company’s purpose should go beyond simply generating profit for its owners, imho; among other things, it should also include a duty of care toward its employees. Society instills a strong work ethic in us from childhood, teaching us that contributing to the greater good is our individual duty. Before the plague of neoliberalism, there was an expectation that companies would have a positive impact on society, too. Nothing, except greed, forbids to return to those values.

[–] ParentiSoundSys 3 days ago

> If I have a team of 20, making a lot of money, but I think I can do the exact same job with 15 because of AI productivity gains, should I keep the other 5 employed for the vibes?

What should actually happen is everyone should be paid the same amount while doing 75% of the work they were doing before, but unfortunately there are no serious power structures like unions which could ensure that technological gains actually improve people's lives in that way.

[–] hajile 3 days ago

Why risk a sure thing? You might have others quit or get rid of someone more important than you thought. The morale hit might affect work quality. Any number of things can go wrong and its simply not worth it when you make $600k in profit per person.

[–] eli_gottlieb 3 days ago

> If I have a team of 20, making a lot of money, but I think I can do the exact same job with 15 because of AI productivity gains, should I keep the other 5 employed for the vibes?

Well no, you should keep the other five to increase your output even more and make even more money.

[–] mr_toad 3 days ago

> now they are up to $134B in net income, and they need to let 25% of the company leave?

Tomorrow they’ll announce that they’re going to spend $134b on new data centers.

[–] ricardobayes 3 days ago

Contrast that with NVIDIA's princely $2.5M net income per employee.

[–] OrangeDelonge 3 days ago

Or Jane Street

[–] bijowo1676 3 days ago

profitable divisions are making more than that per employee

while other divisions are sinking ship

there always a case for a yard cleanup and decluttering