My dad was a newspaper reporter in the early 2000s, so there were several dinner table conversations about this dilemma.

The buyouts were taken by superstars and low performers. The superstars moved on to other things, like working in other forms of media.

Dad didn't take several rounds of buyouts and was fine.

After suffering a stroke, he was "put out to pasture", which for a journalist means he was sent to cover city hall meetings in some suburb. Eventually, he retired with some much smaller payout than what the last buyout would have given him. The sense in the family was that the collapse of the industry denied him a dignified last decade of work. (When the industry was flush with cash, older journalists were sort of like "elder statesmen" in the newsroom. Post-internet, no longer.)

I've a neighbour who declined, and then got hit by layoffs. It was quite a gamble, and they lost out big time.

Honestly, if work was to come at me with a buy-out offer, and I was in a position to be able to afford to not work for a few years, I'd probably accept. Maybe go find some non-tech work for a little bit to stretch the dollars and ensure I have health insurance.

We're in such a bubble at the moment, things are going to get really rough.

> Certain pools of employees, including some focused on data centers, sales and marketing, aren’t eligible, the spokesperson said.

https://www.bloomberg.com/news/articles/2026-10-26/microsoft...

Sales alone is some 25 % of Microsoft expenditures, so are these 60k about 50 % of what's left?

When they offer a package YOU ALWAYS TAKE IT. It means that layoffs are coming.

My friend's company offered a voluntary severance package to a bunch of employees. She was talking to one of her employees and she knew that he was going to get laid off if he didn't take the package but was unable to advise him. I think the voluntary severance was 2 years medical, 2 years of vesting, many months of pay, etc. But he decided not to take the offer and was laid off for a much worse package a few months later.

ALWAYS TAKE THE VOLUNTARY SEVERANCE.

A couple of times in my career, I was one of those who were not given out a buyout. I was chosen to keep the lights on while the number of employees shrank every month. It sucked. I was given responsibility for systems with no documentation or than a username/password. I was called by all sorts of people I had never spoken to who had their hair on fire because the system was breaking left and right. I wished I was given the buyout; instead I was told I should be grateful I had a paycheck. No thanks.

Probably trying to entice people who are close to making a FIRE move (or even just close to normal retirement) to go ahead and do it.

If you still need a job, I don't see it as being very attractive in this environment, unless you're quite senior with very marketable skills.

Didn’t Microsoft have an issue with VP Vance regarding layoffs and all the perm processing were stopped. So why is MS doing this which will bring more trouble.

I've never been involved in such a situation, but I assume part of individual's calculation is: If I indicate interest, but the company doesn't accept it or go through with it and keeps me... am I now viewed as a disloyal, detached worker?

Just because the offer is made to 25% of the workforce doesn’t mean they will all accept. These are generally very well paid jobs and the prospect of entering the job market right now isn’t going to appeal to everyone. Especially not when you have upcoming RSU vests after a recent 50% stock rally. If say a third of the employees accept then it’ll be an ~8% reduction, which is in line with a regular company-wide layoff.

I have been through a similar situation at a former employer, during the aftermath of 2008 crisis, and is complicated.

Exactly as you place it, the way they found out to push for buyouts was to terminate existing positions.

Everyone was forced to decide between taking the buyout, or apply to internal positions instead, naturally the later was much more complicated than just taking the money.

If you get the offer take it and start your own company with it. There's no use in staying if you're not wanted and even though you'll get a severance package it won't amount to much more than a couple months back pay.

If they're doing similar to what was mentioned back in April there is some calculation about current age + years of service that could be tempting to people on the "bubble" of retirement.

Phew, scary! But it maybe a very real question to ask ourselves. 2027 may be the year when all companies do the same and follow the MSFT model.

> Do you decline and hope you don't get hit with the layoff which hits if not enough people accept?

If they need your skills after restructuring, you will be offered your old job back and get to pocket the buyout money.

If they don't need your skills, you're going to get fired anyway.

At least that's how any rational company would handle it. Employees are supposedly hired because they contribute to the company, not to fill seats.

With these kinds of offers, they don't expect to get rid of 60,000. They expect to get rid of Y,000.

They make the offer to 60,000 (typically, an entire department gets this offer, including people they want to keep). Some X,000 will take the offer. If Y,000 > X,000, they they lay off the difference.

Microsoft made $134B in net income in the last 4 quarters. It used to be if you worked for a company that was printing boat loads of money that you had job security.

Now, even if the company is crushing it, they'll still see employees more as a cost center instead of a revenue generator.

The truth of the matter I think is that you do not actually need the best.

Most of the time, anyway.

As far as business is concerned, the thing often runs better with mid people with less leverage. They just do their job, don't have any ideas and you can squeeze them.

Because it's not all the best that are leaving. Just the ones not stuck with a mortgage or similar stuff. This cuts the wings of very capable people and completely strips them off their bargaining power. Which is very useful to management.

I dunno how prevalant this term is, but people at my last robotics company called it the "dead sea effect." Those who can, leave. Those who can't, hang on.

My dad told me his bosses were very surprised when he eagerly accepted a similar deal. IIRC, he was about 60 at the time, so would have had about 6 years early retirement given what the pension age was back then.

Well they’re the ones that cost the most money!

I guess unfortunately there isn't an easy way to just "only fire the employees responsible for making Teams suck".

there’s a difference between a memo passed and a memo read. (let alone a memo acted upon.)

Market is horrible even for 'best employees' . Best employees arent that different from mid employees these days because everyone is slinging the same slop.

Maybe something has changed between now and then? Say, some kind of a technology that allows to select eligible employees better.

> management said if any layoffs will happen in 3 years period after this, same package will be offered no question asked.

And people believed them?!

>so management said if any layoffs will happen in 3 years period after this, same package will be offered no question asked. Cooled things a bit, but what a mess...

Unless those funds were placed in an escrow account, I would have assumed that claim held no water.

Why is MS doing this after the latest troubles with VP Vance regarding layoffs?

So I checked your claim and it is accurate, in 2020 Microsoft had 163,000 while in 2022 it had 221,000.

There is a big HOWEVER. At least 2 in fact.

1. The company had been growing in the previous years, 2019, 2018, 2017 (they shrank somewhat in 2015 or 2016). In 2014 they had 29% workforce increase. So the significant growth in 2021/22 is not an aberration but rather continuation of the growth in previous years.

2. What IS an aberration is the workforce count after 2022. No growth in 2023 or 2025 (as in ZERO YoY change), and measly +7,000/3% growth in 2024. And some YoY loss in 2026 (-5,000, or 2.2%). With 2027 YoY likely showing at least some (and possibly a lot) of these 60,000.

So no, "it's just overhiring due to pandemic" was supposed to die years ago.

I also believe the Twitter exodus exposed the software engineering headcount sham for what it is. Something like 80% of the company left or was let go, and despite all the smug laughing about how the platform would go under within weeks, it just kept on going.

I've heard this "reversing covid-era headcount growth" for every layoff for the past 4 years, how much headcount growth is there to reverse?

It's probably because of bonds interest rates. And we will probably see more of those on the next few months.

yes but going back to 2019 staffing with 2026 revenue is a pretty seismic shift

it's not just experimental fiscal mindsets, cash was a lot cheaper then. funding was cheaper. now it's less. LLMs don't help but some of these headcounts were taking advantage of the free/cheap debt.

A very small fraction will actually take it. You're wrongly considering the headline number.

> Introducing a Voluntary Exit Offer

Headline is making me laugh cause it sounds like a press announcement for a new product

"The new Microsoft Voluntary Exit Offer, thinner, and lighter, with 20% slimmer bezels than before"

What are the terms of the severance? Last time didn't they offer accelerated vesting, etc?

"This offer will be available to eligible employees in participating teams in Canada, India, the United Kingdom and the United States at level 70 and below."

anyone know what level 70 means?

Except they’ve already had layoffs.

>To think you suddenly can get by with up to 25% fewer people.

Not necessarily the reasoning. It might also be that they think their slice of the pie is about to become much smaller, for example.

Would love to have some insider knowledge on this decision.

they know for sure many fewer will accept. there's probably a clause in there that only so many people will be allowed to accept

Oracle has cut 13% of its people in about two years.

So "Up to" 39 weeks of base pay, let's say 9 months.

In this job market, that may not be enough time to feel comfortable and safe taking the offer (if you're a super-employable hotshot with offers awaiting in your LinkedIn, you're probably not the likely target for the offer)

The prior VRP shook out a number of folks who were banking their options grants -- it was like "look let's be clear, you're not moving up any more and you're checked out. Thank you for your service." I'd imagine they were happy enough with that to go a little broader. The pay scales work out to getting paid more the longer you've been there. Mentioned in the memo is employee choice, and I think that this is likely designed with that in mind - why not let people self identify without penalty when you want to reduce headcount? The goal is likely to increase morale for those who want to stay, both by showing them they have the ability to stay, and getting low morale people out the door.

Perhaps because of increased productivity with LLMs, especially for developers?

Why would they spend money to improve a product that they know people will keep buying regardless of its quality?

They are not failing on account of having insufficient workers.

they re doing that.. in india

I've never middle management cut to same levels as IC. I dont know why that is though.

Shirley, you're kidding.

this is a precursor to layoffs though, no? and the total reduction across layoffs and buyouts is likely 1/4?

There's no way 25% of their total employee base are "checked out". Yes, a bunch of folks close to retirement or fed up with working there will take the deal. But with the job market as it is, a whole lot will roll the dice on keeping their job through the inevitable follow-up round of layoffs.

This is just an optics-friendly way to soften the blow of 25% layoffs.

In April, 7% was the announced figure. This is several times higher.

MS has had many rounds of layoffs already in the past 2-3 years. If there was anyone visibly checked out, they'd have been gone quite a while ago.

This many layoffs is likely far beyond "checked out" employees.

It's probably taking advantage of economic arbitrage, plus healthy beliefs in what AI can maintain.

The interesting thing will be to see what new things companies who do this can achieve.

The question above whether to take it now or try to delay taking a package is an interesting thought.

Are you saying they had to hire people to "steal open source"?

The engineers are fine. The system is a mess. It reminds me of the recent post about "SimCity - but with permits."

Even basic things like fixing the pothole doesn't get done because, well, permits.

Then again, if/when they do lay off so many employees, then Microsoft is putting themselves in the position that eventually they will "have no choice" but to depend more and more on agents to do as much of the work as possible...which i predict means that their products will dip in quality even further, at least until models, agents, etc. can markedly improve...so, a continuation or worsening of the quality. The future looks bleak in a few different ways; oof!

They don't think it be like it is, but it do.

An LLM, a decent prompter, and a weekend could certainly out perform Windows Terminal.

It takes human talent to make a product as actively irritating as Teams or the Windows 11 Start Menu.

No one said there wouldn't be churn. It's like if in 1999 a company had 10,000 webmasters - those roles are simply being phased out. New roles are being added and will be added, but they won't be the same or require the exact same skills, for better or worse.

Rapid technological advancement is always painful. Extrapolating that to "death of the industry" is awfully reductive and I haven't seen any signs of that. As others have pointed out, Big Tech layoffs have only reverted the shotgun-blast hiring of ~2020-2022.

Hahaha

It depends on the role, not every position is fungible.

Why do recruiters keep contacting me even though I’m retired?

It'll be interesting to see what orgs are excluded. Maybe it's a cull of Xbox. Maybe it's a cull of core Windows/Office SDE and/or Azure.

The fact that you will be jobless in this economy.

It's 9 months. They probably won't do layoffs again for 6 months and you will get a package then for more than 3 months. Makes sense to hang on.

I can’t think of many companies that would be better to work for than Microsoft in terms of compensation.

In this sort of situation, always take the first offer. Subsequent offers are always worse.

Traditional if you know you’re a shitty employee that can’t find a new job you stay.

Voluntary packages tend to be accepted by the strongest employees

It’s a shitty deal for companies but shareholders love cost cutting

if you prefer being fired!

Some are probably being set up for retirement. I wouldn't feel too bad. You should probably be more worried about yourself.

One of the inherent problems with capitalism is any logical person or company within a certain threshold is not going to pay for or employ people they do not have 'work' for or need. Just like you would not buy a whole bison without a freezer (single or with an extended family); it would be wasteful, regardless of how of I or others might feel a certain amout of those types of employees should be baked into the corporate model (and not as 'corporate welfare'). Most companies have dozens of employees with nebulous duties whose mere presence is something a corporation wants or needs for whatever reason. This happens often in Asia. It also happens because companies look for connections or things they cannot deal with a few days or times a year and people who can do them would not be locateable quickly or maybe want to do it; specialists, too.

Sit on your butt doing nothing for what I would not pay minimum wage for alone, all year, then essentially do a week of work or come up with a solution the company knows is worth millions, so they're largely left alone and paid well. I have, as have others I have known, had those sorts of jobs a few times (things aren't quite like that nowadays, people either get over or underpaid now, and mos of those people have retired by now, or the newer "those types" get stock in the "new model"). Often it is not a hard tech skill but a good gut in an emergency, in tech or business.

Then there is this newfangled "communist" or "socialist" model of "companies" and "work" we are seeing that have nothing to do with either of those "isms" or capitalism, where people protest layoffs and expect everyone can get a paycheck while still refusing to check their egos and selfishness at the door. Of course, the truth is "communistic" things are generally pooled and meted out among people in s "commune" where people share similar very specific values requiring trust, and a great majority of those places do not even have the concept of a paycheck.

Either way, income has to come from somewhere. I mean, I guess feudalism could make a comeback if we had a large population die off and people split their time up between farming with high tech harvesting machines and hanging out playing PS4 games off the solar panels after dark, but in general I think most of the people I have seen getting upset make little or no sense.

I mean, is the goal for firstworld and secondworld countries a handful of neuralinked (no thanks) tech overlords we beg for equal monthly monetary alotments from and a world like in "The Machine Stops"? What would you need to do for that ("Black Mirror" and credits?!).

We can't sure all be "YouTube stars" or "self-affirmation LinkedIn gurus", obviously.

Is is corporate slop speak entirely or are many of them just as flummoxed as many of us?

(disclosure: I usually do 1099 work, but I sure know what it is like to suddenly be blindsided.)

Won't somebody please think of the poor fortune 10 companies

or maybe they just need to lower their operating expenditure because they're spending too much money...

There is a joke "When it comes to AI psychosis, Sam Altman was likely patient 0"

Given all insane bets made by previously (somewhat) reasonable and successful business owners, I wonder how much of a joke it really is...

Especially all at once..

They could have done 10% a year for the next 2-3 years, but the immediate financial gratification wouldn’t be satisfied

Copilot going to pick up the slack of 25% of the workforce?

It’s way too much to be believable