Microsoft cutting 5,000 jobs, sadface emoticons abound
posted Jan 22nd 2009 10:34AM
From: Steve Ballmer
To: All Microsoft FTE
Subject: Realigning Resources and Reducing Costs
In response to the realities of a deteriorating economy, we're taking important steps to realign Microsoft's business. I want to tell you about what we're doing and why.
Today we announced second quarter revenue of $16.6 billion. This number is an increase of just 2 percent compared with the second quarter of last year and it is approximately $900 million below our earlier expectations.
The fact that we are growing at all during the worst recession in two generations reflects our strong business fundamentals and is a testament to your hard work. Our products provide great value to our customers. Our financial position is solid. We have made long-term investments that continue to pay off.
But it is also clear that we are not immune to the effects of the economy. Consumers and businesses have reined in spending, which is affecting PC shipments and IT expenditures.
Our response to this environment must combine a commitment to long-term investments in innovation with prompt action to reduce our costs.
During the second quarter we started down the right path. As the economy deteriorated, we acted quickly. As a result, we reduced operating expenses during the quarter by $600 million. I appreciate the agility you have shown in enabling us to achieve this result.
Now we need to do more. We must make adjustments to ensure that our investments are tightly aligned with current and future revenue opportunities. The current environment requires that we continue to increase our efficiency.
As part of the process of adjustments, we will eliminate up to 5,000 positions in R&D, marketing, sales, finance, LCA, HR, and IT over the next 18 months, of which 1,400 will occur today. We'll also open new positions to support key investment areas during this same period of time. Our net headcount in these functions will decline by 2,000 to 3,000 over the next 18 months. In addition, our workforce in support, consulting, operations, billing, manufacturing, and data center operations will continue to change in direct response to customer needs.
Our leaders all have specific goals to manage costs prudently and thoughtfully. They have the flexibility to adjust the size of their teams so they are appropriately matched to revenue potential, to add headcount where they need to increase investments in order to ensure future success, and to drive efficiency.
To increase efficiency, we're taking a series of aggressive steps. We'll cut travel expenditures 20 percent and make significant reductions in spending on vendors and contingent staff. We've scaled back Puget Sound campus expansion and reduced marketing budgets. We'll also reduce costs by eliminating merit increases for FY10 that would have taken effect in September of this calendar year.
Each of these steps will be difficult. Our priority remains doing right by our customers and our employees. For employees who are directly affected, I know this will be a difficult time for you and I want to assure you that we will provide help and support during this transition. We have established an outplacement center in the Puget Sound region and we'll provide outplacement services in many other locations to help you find new jobs. Some of you may find jobs internally. For those who don't, we will also offer severance pay and other benefits.
The decision to eliminate jobs is a very difficult one. Our people are the foundation of everything we have achieved and we place the highest value on the commitment and hard work that you have dedicated to building this company. But we believe these job eliminations are crucial to our ability to adjust the company's cost structure so that we have the resources to drive future profitable growth.
I encourage you to attend tomorrow's Town Hall at 9am PST in Café 34 or watch the webcast.
While this is the most challenging economic climate we have ever faced, I want to reiterate my confidence in the strength of our competitive position and soundness of our approach.
With these changes in place, I feel confident that we will have the resources we need to continue to invest in long-term computing trends that offer the greatest opportunity to deliver value to our customers and shareholders, benefit to society, and growth for Microsoft.
With our approach to investing for the long term and managing our expenses, I know Microsoft will emerge an even stronger industry leader than it is today.
Thank you for your continued commitment and hard work.
Steve
not a sign of anything really.
just todays world.
Yes, not to worry. Microsoft is still riding that horrible Vista wave. I'm sure Windows 7 will straighten things out, but this report does make me wonder about the Xbox 360. The Xbox lost about 6 billion in the first few years, and at least another 1 billion on the RRODs, but Microsoft turned around and said they were making a profit for a few quarters, while ignoring the massive loses they experienced those first few years. There was never any indication that they were making a profit over all.
The world economies only seem to work on consumerism and manufacturing.
When the credit crisis hit and suddenly the middle class and the wealthy of the world could no longer purchase wildly, that's when you see sudden collapse and regression of the economy.
The way I see it, this is a sign of things to come unless we all focus on producing a new economy. Perhaps that's what the green movement is all about. Reproducing entire infrastructures to be energy efficient and environmentaly friendly. Not just a movement towards cleanliness - but, a transfer of political power.
Fortunately, while all this is happening, I'm working a safe city job in Education.
There are some sectors that I doubt will ever be endangered by the economy: The penal system, criminal defense, the military industrial complexes and medicine to name a few - but, definitely, education.
How the hell is apple making so much money but Microsoft isn't??
@Fatima
Uh, Microsoft is still making money ($4.17 billion) if you read the article above, but compared to last year, their profit is sinking. People aren't buying PCs. And I think people are more likely to buy an iPod or a Wii for someone during Christmas than a brand new copy of Vista. Makes sense to me.
@flashpoint
Obviously you failed economics. All of those things are affected by economy. I work for a school system in Florida budgets are tightening due to the economy a school system close to the one I work in and is the one I live in is cutting things like Art and Music across the board.
All those other suffer horribly due to economic problems. Military, Obama is shutting down certain military stuff right now A. because he doesn't agree with their existence in the first place and B. because we as a nation can't afford to keep them going.
Medicine duh if people don't have jobs they can't pay for their pills and doctor visits.
The other things have always suffered due to economics. Criminal defense especially public criminal defense have suffered horribly. States aren't hiring in the penal system, just decreasing the number of guards per shift. If the Obama pulls out the troops in Iraq do you think the Military industrial Complex is going to have a ticker tape parade, no they will start firing people due to a decrease in demand if anything they will start selling to the Chinese.
it has nothing to do with apple making money and microsoft not. its also NOT important at all how much profit the company made, but rather the profit margin. last quarter, microsoft's pm was 29%, and apple's was 14%. apple's overall profit went up from last quarter and microsoft's went down, but what are the margins?
@Paul
I am over-simplifying for the sake of argument, but (pulling from wikipedia):
Xbox has sold 28 million units sold worldwide, as of 1.5.09. Assuming that every purchaser bought the "Core" version at the American price of $279, we’re talking 7.8 billion dollars.
Add in 17 million Xbox Live subscribers...assuming 10 million are Gold (which seems low)...and they are making somewhere between 500 and 1 billion dollars every year (again, at the American rates).
And this doesn't include downloadable content sales, extra accessory sales, etc.
To be certain - this is hardly air-tight logic, but I don’t think it’s implausible to assume that the Xbox division might (finally) be turning a profit.
@Flashpoint
We got it the first time that you get paid a lot and have a secure job...why do you keep bringing it up??
@Brutalgeuse
But you're talking about revenue, not profit. If Microsoft sells an Xbox, most of that money is repaying manufacturing and shipping costs. And assuming they have that many Xbox Live subscribers, again Microsoft has to use that money to pay for bandwidth, maintenance, etc. It is a well known fact that Microsoft and Sony have been selling their systems well below manufacturing costs for years, while expecting to make up the money in games sales. The only company that doesn't follow that model is Nintendo.
Microsoft has been posting profits in the millions. A hundred million this quarter. I hundred million that quarter. There hasn't been so much profit in games that they've completely cleared out the 7 billion dollars they've lost.
I'm not saying that it's impossible that they're making a real profit, just improbable.
Microsoft stimulus plan:
1. Release windows 7 early
2. Sell it for $100 with rebate to vista owners
let's not buy from Ballmer unless he puts these people back to work
So your plan to make MS re-hire all these people is to not give them any money? Isn't that why they're firing people? Because they didn't get as much money as they though they would?
@ bobby
you realize these people were fired BECAUSE enough people weren't buying right?
if you really care about those people... you'd go buy more microsoft products
except the thing is that microsoft isnt the only compnay affected.
and actually, microsoft is being very kind to those employees
to offer a whole outplacement center and severance pay and other benifits
a lot of companies are just laying people off now
and all they can depend on is unemployment insurance
Surprisingly well-crafted from Ballmer. Unfortunate indeed.
I'm no Steve hater, but I doubt he wrote that himself. They have people for that kind of thing.
Correction - they HAD people to do that sort of thing...
Hey, please write this PR letter for me.
*6 hours later*
Thanks. Oh yeah, you're one of the people in the letter.
It's truly sad what is happening to our nation's workforce... Let's hope things improve soon.
Hooo what can I say? For those ho lost their jobs, I hope they find a new one soon. If they worked on MS, than for sure they are all capable and wise people.
Not necessarily.
There are people who approved the bad ideas that sunk Vista, and there are also the worthless consultants who just crank out spreadsheets.
@JWC
"Historically GDP has grown more during Democratic administrations than in Republic administrations. Source: NYT."
You mean you got that little tidbit from the paper that hasn't endorsed a Republican presidential candidate since Ike in the 1950's, and only 5 since the 1884 election?
It must be true!
"the worthless consultants who just crank out spreadsheets"
Hey, stop dissing my spreadsheets!
Those high-tech white boys will find a new, higher paying job in a day or so. No point in grieving over that. For certain people in the U.S. there's always jobs for the taking.
I've a feeling we'll be seeing more Engadget articles with Great Depression pics..
The US is lucky this time round, it'll bounce back much more quickly due to its massive economy (and Obama's spending) than Europe.
Spending is what will make it worse. FDR spent like crazy and never got us out of the Great Depression and actually made it worse. It wasn't until WWII that the depression started to ease up.
Learn your history or you are doomed to repeat it! Oh Sh*t we elected BHO, who is championing the failed policies of FDR to save our economy.
Sources, kjb? From what I've read, increases in government DID have a positive impact. Things were just so bad it took years to recover.
Also, what do you think the government did during WWII? You could argue that the spending done by FDR pre-war just wasn't enough, and it required the huge outlay of government funds to build tanks and planes to really get our economy running again.
The common thread of recession exit it spending. Someone has to start spending money again, and lots of it. Pre-FDR, we waited for industries to restructure and do it. Post FDR (and Keynes), we expect government to do it. The basic rules didn't change, just who writes the checks.
At least the spending we're planning to do now will be on things that might be around for awhile.
Forrest, do you have a source? Keynes wrote FDR a public letter warning about the massive spending habits of the Government.
Historically GDP has grown more during Democratic administrations than in Republic administrations. Source: NYT. So it's a really good thing we didn't elect McCain. Re: the FDR comment: economists aren't in agreement about government spending vs. tax cuts helping the economy more. Your comment tells me that you're smarter and know more about economics than most economists. I salute you sir.
(but it was a one finger salute :P)
Because GDP is made up of consumer and GOVERNMENT SPENDING. That should tell you to not trust GDP knowing how often Government fudges the numbers in its favor.
Sources aren't too hard to find:
http://en.wikipedia.org/wiki/The_great_depression
FDR wasn't spending enough, only 40% of GDP debt, when his economists were telling him to spend more. He kept us in the depression by not spending. Yamamoto got us out of the depression by forcing us to spend 128% of GDP debt (see citation above). However, you can't spend too much either, otherwise the currency becomes worthless when treasuries and bonds become worth only the paper they were printed on (caused by too much treasury printing done to create debt). Thus, if the government spends too much, it won't matter that your accounts are FDIC insured, since what they will give you will be worthless too. Everybody is saving now, but if this happens, all of what you saved will be worthless, only precious metals and commodities will be worth anything (this is extreme and I don't think it will happen, but it is how the theory goes, and has happened before in history).
Mark,
Granted Wikipedia should always be only a starting point for research, but here's a link:
http://en.wikipedia.org/wiki/Keynesian_economics
From the article:
"Keynes argued that the solution to depression was to stimulate the economy ("inducement to invest") through some combination of two approaches :
* a reduction in interest rates.
* Government investment in infrastructure - the injection of income results in more spending in the general economy, which in turn stimulates more production and investment involving still more income and spending and so forth. The initial stimulation starts a cascade of events, whose total increase in economic activity is a multiple of the original investment.[1]
"
In fact, from Keynes' letter to FDR: (http://newdeal.feri.org/misc/keynes2.htm)
"Individuals must be induced to spend more out o their existing incomes; or the business world must be induced, either by increased confidence in the prospects or by a lower rate of interest, to create additional current incomes in the hands of their employees, which is what happens when either the working or the fixed capital of the country is being increased; or public authority must be called in aid to create additional current incomes through the expenditure of borrowed or printed money. In bad times the first factor cannot be expected to work on a sufficient scale. The second factor will come in as the second wave of attack on the slump after the tide has been turned by the expenditures of public authority. It is, therefore, only from the third factor that we can expect the initial major impulse."
He says that the people can't afford to spend, and that businesses will only start hiring and paying people more once they have confidence (or lower interest rates), and THAT can only happen after the government has dumped money into the system.
Again, from his letter:
"I am not surprised that so little has been spent up-to-date. Our own experience has shown how difficult it is to improvise useful Loan-expenditures at short notice. There are many obstacle to be patiently overcome, if waste, inefficiency and corruption are to be avoided. There are many factors, which I need not stop to enumerate, which render especially difficult in the United States the rapid improvisation of a vast programme of public works. I do not blame Mr Ickes for being cautious and careful. But the risks of less speed must be weighed against those of more haste. He must get across the crevasses before it is dark."
In other words, 'uh...it is risky, but please spend more, and faster'
And finally:
"You may be feeling by now, Mr President, that my criticism is more obvious than my sympathy. Yet truly that is not so. You remain for me the ruler whose general outlook and attitude to the tasks of government are the most sympathetic in the world. You are the only one who sees the necessity of a profound change of methods and is attempting it without intolerance, tyranny or destruction. You are feeling your way by trial and error, and are felt to be, as you should be, entirely uncommitted in your own person to the details of a particular technique. In my country, as in your own, your position remains singularly untouched by criticism of this or the other detail. Our hope and our faith are based on broader considerations."
In other words "your specific approach could use some work, but you're on the right track". Keynes then offers several suggestions on how policy might be changed to have a more efficient impact.
Again, like I said...maybe the early attempts at deficit spending were just insufficient? From my interpretation of his letter, it seems Keynes felt that way, at least early on.
@JWC
"Historically GDP has grown more during Democratic administrations than in Republic administrations. Source: NYT."
You mean you got that little tidbit from the paper that hasn't endorsed a Republican presidential candidate since Ike in the 1950's, and only 5 since the 1884 election?
It must be true!
It is a really sad state of of afairs when people are still relying on Keyes when his theories have been proven wrong so many times.
I would suggest reading "Capitalism and Freedom" by Milton Friedman.
In the early 90's Japan's economy tanked and the Japanese government went on a Keynesian style spending orgy to "repair" their economy.
Today, Japanese stocks are still, nearly two decades latter only 80% of their 1980s value.
Same thing happened in North Korea, but the Korean government did not bail out the bad investments on the backs of the tax payers, how are they doing now?
The facts are these: During FDR's orgy of spending (in which unemployment remianed at about 20%) the economy did not improve - at all. It was only when the Federal Government conscripted 12 million Americans, imprisoned a large number of foriegners, seized their bank accounts, instituted rationing, seized private property of citizens and foriengers alike, and otherwise set up a near totalitarian government did the economy recover - and then only after nearly a decade.
Our current economic woes will right themselves in 6 to 12 months with or without Government assistance. Big spending only increases the likelyhood that the recession will last longer and go deeper. and possible slide us into a depression.
When the crash happened in 1929, we were not in a depression - just a recession. The depression hit when the administration decided the only way to "fix" the problem was to institute federal spending programs, increase taxes and raise tarriffs. Government's attempts to alter the market corrections (which may have initially been caused by the newly founded Federal Reserve, anyway) caused the depression.
Sounds awfully familar to today's tactics.
Just ask yourself this: Why the big rush to spend nearly a trillion new dollars? The first half a trillion the Government doled out to the losers had no perceived benefit to the economy, so does throwing good money after bad make sence? Why not simply wait six months or a year, see what the market will do on its own, before we socialize the losses (while keeping the profits private) of all these bad investments?
Unless, of course, you all want to return to the days of rationing, conscription, detainment camps, and near Total Government.
"The facts are these: During FDR's orgy of spending (in which unemployment remianed at about 20%) the economy did not improve - at all. It was only when the Federal Government conscripted 12 million Americans, imprisoned a large number of foriegners, seized their bank accounts, instituted rationing, seized private property of citizens and foriengers alike, and otherwise set up a near totalitarian government did the economy recover - and then only after nearly a decade.
"
I'm curious what version of history you're being fed, and who is feeding it to you.
Take a look at a couple of graphs:
http://en.wikipedia.org/wiki/File:1930Industry.svg
Industrial output of the US, from 1928 to 1940. Notice the *deep trough* that bottomed out mid-way through 1932. That is before FDR took office and started implementing the first New Deal.
The second:
US GDP from 1920 to 1940. Again, notice the *deep trough* that bottomed out mid-way through 1932.
Both of those graphs indicate that both industrial production and GDP had reached pre-depression levels by the time the US entered WWII. Granted some of that was probably a ramping-up for war, but if you want to look at the actual numbers (instead of insulting people) you can see there were definite increases in both indicators starting shortly after FDR took office.
One final graph for you:
http://en.wikipedia.org/wiki/File:US_Employment_Graph_-_1920_to_1940.svg
Total US employment (ignoring farms and WPA) from 1920 to 1940. You really shouldn't make things up when it's so simple to find evidence to the contrary. It doesn't help your argument. It's true that private sector employment didn't recover as quickly as the rest of the economy, but there WAS some improvement. Also, don't forget that the New Deal was a lot more than just a bunch of federal spending. There were some moves early on that were VERY hostile to business (look up the NRA) - things that put today's cries of 'socialism' to shame.
Some would point to the recession of 1937 without seeing it in the broader context of the depression, and offer that as proof that the New Deal 'failed'. The New Deal was far from perfect, but all the research I've done tells me that deficit spending, when done properly, can soften the effects of a recession.
Bleh, missed the link to US GDP from 1920 to 1940:
http://en.wikipedia.org/wiki/File:Gdp20-40.jpg
Forrest:
First off, I did not insult anyone. Second, unemployment averaged %17 percent throughout the new deal - I did not make this up. Third, I suggest you need to look at other resources if you wish to complete your research.
http://www.cato.org/pub_display.php?pub_id=3357
Forrest:
Here is a more topical article about why deficit spending is a bad idea, from the same brilliant minds of Cato.
http://www.cato.org/pub_display.php?pub_id=9901
Mycroft,
Sorry, I guess you weren't insulting. Maybe a better word would be dismissive? There is a lot of disagreement in this area...I think anyone who flatly claims they have the answer is foolish.
Anyway, the first article doesn't provide any data. It just claims that the New Deal 'prolonged unemployment' that 'averaged' 17%. It 'averaged' 17% because it was higher at the start of the decade, and lower at the end. If you look at the data, that is.
That said, I don't hold to the idea that the New Deal was the magic bullet that solved all our problems. There were some really silly ideas introduced. Some *very* harsh business regulations that ultimately hurt growth. But even the article you reference places some of the blame on tax increases. If anything, that article provides support for *deficit* spending, not 'redistribution of wealth' like what the New Deal attempted. The New Deal gave money back, but it also took money away, so it didn't do the kind of good to the economy that it might have otherwise. I think that's what Keynes was getting at in his letter to FDR - the provisions of the NIRA weren't the best to bring about recovery. Deficit spending implies public funds being introduced without an offsetting increase in public revenue. In other words, spend more money and don't raise taxes.
As for your second reference, I would agree to some extent. But it makes the assumption that government intervention is intended to prop up overzealous spending, thus preventing the kind of necessary correction that recessions provide to the economy. I don't think that's the case at all, though. Government intervention should exist to minimize the fluctuations - both positive and negative. Unfettered capitalism can be damned harsh on society, and deadly to governments.
I think in our most recent case the government didn't do *enough* to minimize upward fluctuations in asset appreciation and rampant consumer debt, so the resulting crash afterward has been (and will continue to be) rough. Sure, with no government intervention we'll eventually see an upswing. But just how bad will it get in the meantime? There comes a point where government intervention would be *expected* by a majority of the population, or serious civil unrest could result.
"The US is lucky this time round, it'll bounce back much more quickly due to its massive economy (and Obama's spending) than Europe."
Hm.. Interesting. Most people believe the US is the CAUSE of the global economic crisis, and in fact will be decimated, while those who are merely investing in the US (eg China, Europe, Middle East) will lose SOME wealth.
I guess you missed the part about how, the US Economy was fictional, mostly fluff.
Quick question: what is made in the US? What is made in China? What is made in Korea/Japan? Think about that.
@mike
That exactly is the irony of the whole situation.
Can't beat them, join them.
Five thousand is not as bad as some people were predicting; Still bad, but overall better than expected.
5000 is around 5.5% of their workforce.
Oh, and In before annoying people commenting on how Apple hasn't downsized yet.
what are you talking about? Apple's already "laid off" Jobs...
*Hands Kirby his coat*
Oh and In before annoying people commenting on how Apple isn't downsizing yet.
You're so paranoid about people praising Apple that you had to say it twice. Good lord.
Yeah, Engadget comments system, it's fantastic.
Secondly, Mr. Chapel, YOU'RE so paranoid about people doing the opposite, you comment repeatedly and Verbatim. In different threads. Whenever possible.
Thirdly, way to go ahead and prove my point.
I love you too.
Engadget romances are so darn cute!
ah what's the big deal, was probably Zune people for the most part - expendable.
I see the fact that Zune made it to the market and has good reviews, still makes you sleep bad, troll.
Disgusting that a company with *Billions* in profit is laying off people. This kind of thing is just adding to the problems with our economy. Corporations that have such high levels of income and profit have no excuse for layoffs..
...and that is the danger and evils of capitalism.
Rather than saying: hey, we made 1.6 B in profit, lets pay our workers until we can make more, the thinking is...."let's lay them off to save money".
I think the movie "roger & Me" put it best.
"cut 5000 jobs? - I'd cut 50,0000 jobs if it would ensure the future of the company"
I agree wholeheartedly. That's the first thing I noticed. If a company has $4.17B in profits, laying off 5,000 people seems ridiculous. Of course, all else being factored: taxes, salaries, facilities, healthcare, the company could end up saving over $500M/year.
It's just the way the capitalist system works. The companies have to answer to shareholders, who demand a certain level of profit. If the company can increase profit (or decrease costs) by laying off people, that's what shareholders like to see. They certainly don't invest in a company for the well-being of the employees. Unfortunately, some of the people directly affected (negatively) may also be shareholders.
However, companies do find that they have a percentage of staff who are not contributing as they perhaps should. The company and would rather tighten their belts early to protect the rest of the people who are contributing. In a company the size of Microsoft 5,000 would probably be about right.
uh Microsoft doesn't have an infinite source of money. Losing $10 billion is a big deal for a $80 billion company. Who says they will ever become profitable again?
Actually layoffs like this can be a 'trim the fat' kind of operation. In good times, money can be spent frivolously, and companies pick up dead weight. A downturn in profits are a good excuse for management to eliminate people that really have no business being employed at that company. If you work at a decent sized company, think about your coworkers - isn't there at least ONE person (or maybe even whole groups), nice as they may be, that is clueless and isn't earning their keep?
If they wanted to they could keep on their entire staff and weather the storm. No sense in keeping bad employees around when you have an excuse to get rid of them. It's unfortunate, but that's capitalism. Companies restructure during recessions so they can emerge stronger and more profitable. If they don't do so, they're wasting the opportunity and they can do lasting harm to their ability to compete with companies who DO restructure.
I agree with Forrest: While it sucks that people are out of work, and I'm sure at least some of these people are completely competent employees, I think a lot of these companies are using "this economy" as an excuse to get rid of dead weight and not look like complete jerks (and avoid lawsuits from those same shady employees. They don't work hard, but they sure know a lawyer as soon as their job is threatened). Even look at Circuit City: they blame it on the economy, but they were in trouble long before the economy was bad. It just makes management not look as bad when they can point to other reasons why the store was closing.
The one "company" that really trim some fat is the government. I have friends that work at NASA in the Cleveland office just out of college, and they have pictures on their phones of fat older women sleeping (completely unconscious, head down on desk) in the middle of the work day. Yet, when's the last time the govt laid people off?
...and that is the danger and evils of capitalism.
As opposed the the benefits of socialism? I guess we could continue down the road of bailing out failing companines that cannot reduse their workforce so that the may continue to overpay their employees and produce inferior products. And then appoint a "Czar" to monitor that failing industry, to ensure they institute unproven, but politically popular technologies into their products. Sounds like a plan.
Socialism=control
Capitalism=freedom
Sorry, but I do not see that he feel sorry about cutting 5,000 jobs. Since the beginning of this letter, I do not know with whom he is talking to. If I am an employee, I should feel good about the company obtains less lost because of the excellent move by cutting the labors?
I feel that he is talking to a share-holder rather than a real employee which would like to "work hard" and see the company try to take care of them as well as they work as one to maintain the company. Sorry, I feel ... depressed
"1,400 will occur today" I can just imagine it
boss walks up to employees desk while employee is reading the memo.
"I see you've gotten the memo Johnson, here's your box."
I'm sorry for all those who need to find a job when there are none. I hope there's a TPS report out there somewhere for you.
They probably just started things off with a candid discussion on new slogan/marketing ideas.
"Who do you want to layoff today?"
"Windows Vista: Unemployment Experiment"
"I'm an Unemployed"
Unemployment line with people who have "I'm a PC" shirts.
As an Apple fanboy, I was just wondering if we could start referring to Microsoft as "beleaguered?
Right, if this had happened to Apple, everyone would be saying: "Ha, ha, Apple is doomed. Suck it, fanboys" and a bunch of other stuff that I can't repeat here. Of course, I've read some articles about Apple's sales numbers on other sites and the Anti-Apple people are still saying Apple is going to get hit in the "near future."
Listen up, haters, if Apple hasn't been hit yet, and we've been in a recession for over a year now, I doubt very much it's going to happen in the near future.
Also, when Microsoft's stock gets hit, it's just a sign of the larger market. When it's Apple's stock we're talking about, it's because people "don't buy shiny things in a depressed market."
Surely, Windows 7 will fix all this!
I'm holding my breath for SP1
not good times, hope they find jobs soon
*pours out liqour on street for fallen micro$oft $oldiers*
2% growth leads to (approximately) 5% workforce reduction.
Yay for publicly traded companies! May thy shareholders ever be richer.
Hey kgb434, typical Conservative malarkey regarding the Great Depression and your FDR slant. As Nobel-winning economist Paul Krugman notes, in 1937-38, FDR "was persuaded to balance the budget" and "cut spending, and the economy went back down again."
Gotta love the stock market and share holder greed.... In days gone by, continuing to turn a profit was considered good enough. Now failing to realise unrealistic targets, yet still remaining highly profitable is the signal to shed staff.
Squiggle makes a good point. Cutting staff across the board like that means Microsoft will not have a technical, support, and marketing advantage when the recession ends. Ballmer and Microsoft are acting in the interest of the short term only at the expense of growth in the long term.
Actually I would argue the opposite, bioadam. They're getting rid of people they don't really need, and doing so before things get too bad. This will allow them to retain their core valuable employees in each area. Those employees will also work a bit harder - partly from necessity, and partly from fear of getting the axe too.
When things start to turn around, there will be no shortage of available talent. Microsoft will be able to pick up quality employees as demand for their goods and services rise. Granted they could always screw that up, but increasing efficiency is never a bad idea. The recession just gives lots of companies convenient excuses to do it.
Anyone know if any of these people signed non-compete clauses in their employment? If so that totally sucks....
I think typically a company doesn't have the right to prevent you from earning a living if they let you go. You may not be able to quit and go elsewhere, but if they cut you loose, it's all fair game. Maybe with the exception of specific IP agreements.
We hired some employees that were let go by a competitor, and said competitor threatened to sue us to prevent the new guys from contacting old customers. They didn't do it, though, because they couldn't win.
Yeah, thats a joke. Downsize now to make your stockholders happy.
It may be they had alot of fat to trim?
Windows 7 must be real close to done.
They will make some money on that one.
I notice alot of what they said they'd do over the last 18 months has evaporated, as usual.
:-(
=(
:[
:<
Engadget should start a "layoff" series and a monthly compilation of these articles would be nice too.
http://www.engadget.com/tag/layoffs/
If that's what makes you warm and fuzzy inside...
I wish we had a count of which specific divisions shed people.
Hopefully they kicked Major Nelson to the curb....I hear the local GameStop is hiring.
This is terrible news for those 5,000 employees. Nobody would EVER hire a Microsoft rejectee...
Imagine all those people with 'Vista developement team' on their resumes... people will laugh at them!
Riiiight... Because Vista is the new ME... Yes, we get it.
You can't work for Microsoft if you haven't got some serious skills, so I doubt that the axed employees will suffer too much.
Another company job cutting!
Now now people remember this is Microsoft so make your comment extra harsh. I would use words like M$, BSOD, freaky Ballmer, Vista sucks...
I'm not the smartest guy and I'm pretty far from being an economist but why not take that $850 billion stimulus pkg and use it to incentivize large companies like MS, Dell, etc to bring back jobs that have been moved off shore?
It seems that creating/retaining jobs that produce goods & services would have a greater impact on the consumer goods and housing markets than everyone getting a measly few hundred dollars on their tax refund.
I know a lot of people who would be buying houses and/or purchasing "wanted not needed" goods if they weren't scared they might not have a job tomorrow.
Sure, the effect is probably less immediate but it seems that it would result in a more sustained recovery and be less costly to the taxpayers. Hell, states already give companies huge tax breaks and other things for opening facilities in their locals so it doesn't seem like as much of a jump. Just make it for every X number of jobs moved back to the US and maintained for Y number of years a company will receive a set amount of $$
The reason why the government isn't giving money to the people or specific companies are because of several legal and other reasons. One big one is that you want to give the money to companies that are considered maximally "cyclical" meaning that they would create jobs, that would create jobs, that would create jobs, and so on. Banks are cyclical, the big 3 motor corps are cyclical, Microsoft and Dell are not as much, and giving to the public is not at all (i.e. stimulus package). Giving to the public is like injecting the body with atropine, or some strong, transient stimulant, it has a quick affect in dire situations, but isn't lasting. What the government needs to do is build up fat reserves through cyclical investments. Cyclical can also be seen as pouring champagne on the top of the glass pyramid rather than at the bottom (bad example I know).
Great points. I was referring to the $800+ billion package and tax cuts our current premier oops I mean president is trying to push through.
I agree that the Government shouldn't be spending tax dollars on stimulus packages but since they are it seems the more strategic approach is to create real jobs, not the useless unproductive jobs FDR created. An $850 tax break certainly isn't going to drive me to buy a house or a major purchase like a computer, car, or new TV, but I'd be more likely to do those things if I wasn't worried about another round of corporate layoffs.
I do see your point about companies like Dell & MS compared to banks and auto makers, though it seems to me that the unions in the auto industry would prohibit an infusion into that industry from really accomplishing much. Either way though it just seems that if we're going to spend the money it should be done more strategically than what's currently on the table. You can't treat a sucking chest wound with a band aid and expect it to heal.
! I am truly appalled. The post below was voted down, and was the first one to actually make any sense:
[quote]kjb434 @ Jan 22nd 2009 10:48AM
Spending is what will make it worse. FDR spent like crazy and never got us out of the Great Depression and actually made it worse. It wasn't until WWII that the depression started to ease up.
Learn your history or you are doomed to repeat it! Oh Sh*t we elected BHO, who is championing the failed policies of FDR to save our economy.[/quote]
http://thehill.com/dick-morris/the-obama-presidency--here-comes-socialism-2009-01-20.html
what we need is a bigger war so we can employ people to kill people, pay people to make things that kill people, get in even more massive dept (how much money can we borrow): we need WWIII!
Praise god and pass the ammunition!
/sarcasm
The "Reply" button is your friend.
Hmm, the depression started to ease up with the coming of WWII? And what exactly was the government doing during WWII?
Spending large amounts of money and funding the creation of the military-industrial complex perhaps?
MICROSOFT:
yeah sorry for those employees we had to layoff, thanks for all the hard work
your sacrifices will help us continue to spend the $300 million we allocated to marketing Vista, help us to continue to sell XBOX-360s at a loss, and get rights to exclusive game content.
I'm sure when good times hit many of you will have start-ups with great software that will we simply buyout all over again ;)
Given that the company actually made money I'm sure this is just a smokescreen to fire folks in the US and hire folks in India.
Microsoft: champion of the H-1B visa
Very sad news..
Intel is cutting 6,000 jobs too, along with just about every other company. I think a full Depression is only six months away.