Microsoft Offers Voluntary Exit Buyout to About 60,000 Employees Amid Massive AI Infrastructure Push

Microsoft, like other tech giants, has increased its spending on building AI infrastructure, including setting up data centers and custom chipsets for on-device AI processing. This has also led to a deeper integration of AI in daily workflows and operations of global firms. This, coupled with the massive hiring drives during the pandemic, is driving a wave of layoffs, primarily affecting middle managers and other white-collar workers. Earlier this year, Microsoft announced fresh layoffs and voluntary retirement programmes. Now, the tech giant is offering money to “some” employees for voluntarily leaving their jobs. This coincides with its increased capital expenditure on building AI infrastructure.

Microsoft Offers a Voluntary Exit Offer to 27 Percent of its Workforce

On Monday, in a blog post, Microsoft's Executive Vice President and Chief People Officer, Amy Coleman, announced that the tech giant is offering a Voluntary Exit Offer (VEO) to “some” employees in the US, India, the UK, and Canada. Further, the company executive said that Microsoft employees with an experience level of 70 or below are eligible for the voluntary exit package, which will include multiple pay components.

Microsoft says that the VEO is a “time-limited” programme, allowing eligible employees to leave the tech giant “with financial support and career planning resources”. Coleman writes, “Participation varies based on each business's priorities, customer commitments and workforce needs.”

Citing a person familiar with the matter, CNBC reports that about 60,000 employees of Microsoft's total workforce are eligible for the voluntary exit package, which accounts for 27 percent of its total workforce of 2,23,000 people. “The Voluntary Exit Offer reflects an important part of how we're evolving our approach to change: creating greater flexibility and, where possible, more ways for employees to shape their next chapter,” Coleman wrote.

In April, the tech giant announced its voluntary retirement programme, allowing employees to exit Microsoft with pay. About 7 percent of its total workforce was reportedly eligible for the voluntary retirement programme. This further builds on the company's efforts to reduce its workforce. Earlier this year, the tech giant also laid off about 4,800 employees.

At the same time, Microsoft continues to invest heavily in developing chipsets for on-device AI processing. However, the largest part of its investments is currently going towards building AI data centers.