Microsoft lays off WA workers, weeks after companywide cuts

Microsoft is laying off 305 employees in Washington, almost three weeks after companywide cuts that saw 3% of the company’s staff sent packing.

The Redmond-based tech giant notified affected workers Monday, according to a state Employment Security Department filing.

Microsoft wouldn’t say if employees outside of Washington were affected by the latest layoffs, but revealed the layoffs represented much less than 1% of its total workforce.

“We continue to implement organizational changes necessary to best position the company for success in a dynamic marketplace,” a Microsoft spokesperson said in a statement.

In mid-May, the company laid off more than 6,000 people in a 3% cut of its workforce. In Washington, 1,985 employees were affected.

As of last year, Microsoft reported it had 228,000 employees worldwide.

Microsoft justified the layoffs Monday and those in May by saying it was restructuring its workforce, aiming for more agile teams and higher manager-to-employee ratios.

The company said it was looking to flatten management layers, but data from the state showed mostly non-managers were affected. The layoffs hit software engineers and product managers the hardest. Less than 17% of the layoffs affected employees who were listed as managers.

The layoffs in May were not performance-based, according to a Microsoft spokesperson.

Between the two rounds of layoffs, Microsoft has fired almost 2,300 employees in Washington this year. Microsoft’s most recent mass culling was in 2023, when the tech giant let go of roughly 3,200 people.

The company’s layoffs in 2023 were part of a larger industry trend. After rapid growth during the COVID-19 pandemic, tech companies like Microsoft, Amazon, Meta and Google laid off thousands of workers in an effort to reduce their head counts.

The circumstances for Microsoft are different this time around. Seesaw trade policies loom over the tech industry at large, but Microsoft came out of the past two months as the world’s most valuable company. It also beat Wall Street expectations during its most recent earnings call with a reported $25.8 billion in profit for the first three months of 2025.

Artificial intelligence-induced anxiety is swirling around tech companies now. Microsoft, which pitches itself as a standard-setter for the future of AI, is boasting about the workplace efficiencies its AI tech and framework can bring.

When chatbots like ChatGPT were launched, the content generated roiled creative job markets. The AI models can spit out answers and conversational dialogue using simple questions and requests from the user.

Companies soon revealed that AI could assist with software coding as well.

A week after the May layoffs, CEO Satya Nadella showed a crowd of hundreds at Microsoft’s Build conference the multitasking he’s able to do with AI models. Essentially, the work that used to take hours can be done in minutes.

In April, Nadella said in a fireside chat with Meta CEO Mark Zuckerberg that 20% to 30% of the company’s code was written by AI.

Bloomberg reported last week that Salesforce, a company that specializes in sales and marketing software, is cutting back on hiring engineers and customer service workers thanks to AI efficiencies.

Microsoft didn’t say this boost of productivity from its AI use is fueling the layoffs. It repeated that the company is streamlining its corporate structure and removing redundancy, rhetoric that’s also been voiced by Starbucks CEO Brian Niccol during recent layoffs.

But Microsoft did say in a statement it will “empower employees to spend more time focusing on meaningful work by leveraging new technologies and capabilities.”

Jean Atelsek, a senior research analyst for S&P Global Market Intelligence, told The Seattle Times last month that heavier investment in AI doesn’t have to simply lead to layoffs. With a rapidly evolving technology like AI, and billions of dollars spent to justify, slimmer chains-of-command should be expected.

Companies like Microsoft, which has committed $80 billion to building out its AI infrastructure, are also mindful of cutting costs to keep their margins down.

“People are talking about the AI transition as being as significant as the server to cloud transition,” Atelsek said. “So realigning teams for that seems like a justified reason.”

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