Comment by pseudosavant
19 hours ago
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?
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.
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.
> 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.
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.
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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?
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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.
> 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.
> 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.
> 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.
Contrast that with NVIDIA's princely $2.5M net income per employee.
Or Jane Street
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