In recent news, Microsoft has layoff over 9,000 employees. Microsoft also made additional cuts in employment in May of this year nearly laying off 6,000 workers, the mass of cuts this year is the largest that Microsoft has done in nearly two years. 830 workers worked in the Microsoft division in Redmond, WA, which were mostly software engineers and product management positions, which effected their gaming division. Although Microsoft hired 228,000 workers as of June 2024, with the recent cuts this would mean that 4% of the workforce across multiple divisions were loss and $500 million would be invested into AI this year. Here’s why Microsoft did this.
Increase in AI Technology
The rise in AI is slowly taking over and with Microsoft it’s no exception. During last year alone Microsoft has invested more than nearly $80 billion on AI in it’s fiscal year. With the rise in AI means multiple job cuts that effect the gaming divisions of Microsoft. The hiring process is even being transition to AI, by using AI for hiring, applicants for not just Microsoft, but for multiple companies will be using AI algorithm that will pickup certain words on the person resume. In other words, if the person does not use the right words, the AI algorithm will kick the resume out deeming it non applicable.
Other companies like Google, Meta and Amazon have also announced layoffs following Microsoft footsteps. Meta spent $65 billion, Google spent $75 billion and Amazon spent $100 billion to fund AI technology further expanding the idea to multiple tech divisions according to the Street. The increase in AI tech in the tech and gaming industry has contribute to unemployment to fall to 4.1% and adding non farm jobs instead.
Cancelled Games
With layoffs comes games that were once in development to be cancelled. In the recent incident of layoffs, Microsoft decided to close lots of it’s gaming division to save on cost. Microsoft division the Initiative was shut down causing games like the reboot of Perfect Dark, Everwild and several unannounced projects to be cancelled. However, Microsoft stated that it still has 40 projects that are still in the early stages in development. Blizzard game Warcraft Rumble was effected by the layoffs as well prompting Blizzard to not update the game in the future.
Controversy
Many gaming companies expressed their disbelief on Microsoft’s decision. According to gamespot, Shaun Noguchi who is EA of Japan GM expressed disappointment and deep pain about Microsoft recent plans by saying how the western gaming companies chase short-term profits and reduce long term payoffs. Pokemon Company Tech VP said “It Heartbreaking” and calls Microsoft’s decision a “colossal waste of talent” With the amid of AI rising this could be a big disaster for the gaming industry for the west as a whole.
But what are your thoughts? Do you think Microsoft is making the right decision or the wrong one. Let’s me know.
Source links:
https://www.thestreet.com/technology/microsoft-exec-offers-horrifying-advice-to-laid-off-employees
https://futurism.com/microsoft-boss-ai-advice
https://apnews.com/article/microsoft-layoffs-xbox-f44079957b12370f72e24edebe9fcc6b
