Paying to get rid of your institutional knowledge and experience is an insane move, especially as everything is on fire.
Do I think that's what Microsoft is doing here? No, not really. I think they're pulling an IBM - axing older workers generally in favor of younger ones, but done so in a way that won't result in a sueball. I agree with you that right now they need folks with institutional knowledge and experience to gradually hand over the helm to the next set of folks, and this isn't the way to go about it (that would've been all the previous rounds of wholly unnecessary layoffs).
It's just a way to juice the share price through performative restructuring, in my opinion.
1) you lose 1 or 2 million net, in the scenario where you would've otherwise stayed working 4 more years. 2) you lose ~200k net, in the scenario where you get another comparable job, but the job search takes 9 months. 3) you come out ahead if you were about to retire/get laid off anyway.
So, I don't think this plan is going to eliminate a random sampling of senior folks. The folks who accept this offer will tend to be ones that don't super enjoy the work itself, or ones that anticipate bad rewards or impending layoff.
In other words, I doubt it will be a sweet enough deal to entice the already-rich, high performing principal engineers, or the passionate nerds who are just there because they want to be.
I always felt thats the deal. But not a lot of people left the company when one was given, and we have rolling buys out now so people are trying to time buyout + a new job offer.
Folks who have institutional knowledge that is really critical to the company are likely treated quite well in prestigious roles and paid handsomely. If they take a modest buyout offer, it's probably because they were close to retirement anyway. Any truly critical role will have a succession plan. And if someone the company really doesn't want to lose signals they intend to take the offer without a credible succession plan, the company could just make them an even better personal offer to stay.
At the same time, I'm sure there are many folks who over-estimate how important their role and knowledge are to the company, especially to its future, which may look increasingly different from its past. Some of these people can become active blockers or political problems that are difficult, visible, and painful to deal with. Getting them to exit on their own is a win for the company, and it avoids the morale problem of visibly performance managing them or firing them.
Seems like a voluntarily retirement offer for older employees
Though based on the headlines that I've seen regarding Azure development I'm not confident that they would end up in a better place if this ends up happening.
But maybe who knows, they might open source the NT kernel as there will be nobody left to maintain it within Microsoft.
NT Kernel, Direct3D, .NET Runtime. Also a lot of stuff that came out of Microsoft Research like Z3.
Which also happen to be the sort of projects older devs would normally be working on.
Is that ageism? How is that different than saying if their gender is Y, their race is X or their religious belief is Z?
Offering a buyout is in no way discriminatory since it is voluntary. If it was forced buyout, then yes it would be discriminatory
I think it's 40 https://www.eeoc.gov/age-discrimination. So for 40 or less years + X years worked to be more than 70 they'd have to work there 30 years starting at 10 years old or younger. Granted, some of the decisions I saw Microsoft make do look like they were made by 10 year olds, so maybe there is some truth there.
> Offering a buyout is in no way discriminatory since it is voluntary. If it was forced buyout, then yes it would be discriminatory
Still, what if they offered it based on gender, religious belief, or race? Would that look just as good or bad of an offer.
In Spain there’s something similar called “prejubilación” (apologies for the Spanish link but the Wikipedia entry does not have an English version):
Nobody wants to admit this (and there's a lot of reasons it could be temporary factors like "overhiring"), but to me this seems primarily if not exclusively driven by AI. You just can't say that to HR.
The bigger question is if this keeps accelerating, can the industry and broader economy handle so many jobs disappearing, so fast?
How "temporary" is overhiring? I think that they could probably cut quite a bit from the company, and it might actually improve their output.
Cynical? Yeah, but I fail to see evidence to the contrary yet.
> The bigger question is if this keeps accelerating, can the industry and broader economy handle so many jobs disappearing, so fast?
No, but smarter economies are already adapting. These companies make money through "butts in seats" licensing schemes, and their continuous layoffs and devaluing of labor in the face of constant price hikes are scaring businesses in other sectors into following suit with layoffs of their own. Eventually one or more of them will cross the trust thermocline (my money is on Microsoft), at which point numbers will collapse so fast that everyone else suffers for it as the larger economy panics. Think a bank run, but on XaaS licensing as companies downsize and cut their cloud bills, which in turn causes those companies to downsize, which slows economic engines in other tertiary industries, who then cut their headcount and licensing bills, etc, etc.
It's going to be a vicious cycle, but the thinking seems to be that doing this will depress the value of technical labor (some of the last highly-paid labor out there) between a glut of supply and AI offsetting some costs, with the assumption that consumers/workers will suck it up, cut back somehow, and make it work again.
Except that can't happen this time around. Fifty-odd years of American boom-bust cycles have left workers - especially younger workers - with nothing left to cut to survive. The cost of necessities is already unaffordable on current wages, and there's this expectation that we'll figure out how to cut down even further on our paychecks while still paying record prices for everything. The math doesn't work anymore, and so this downturn is going to hurt exponentially worse than the COVID, 2008, dotcom, S&L crisis, or stagflation turned out.
If you try to pattern match using news headlines towards some belief, you will. But the statistics are often a lot more boring.
But they're not replacing these employees. That may come, in the future, but it's not what's happening. This is freeing up money at any cost to products.
This "buyout" appears to extend that benefit to employees who are >= 50 and have been with the company for 20 years. (Or any other combination that adds up to 70, for example you are 46 and have been with the company for 24 years).
Lots of us thought they peaked during the Windows XP, now it looks like the Windows 10 era will be their peak beginning a long decline.
There have been major missteps trying to turn Windows into a subscription/surveillance product, combined with Azure being a mess, Europe running away from American locked in products, OpenAI losing the lead and the space becomming crowded and expensive, and the console wars being won by Steam... yup Microsoft is the new IBM. Clinging on to as much enterprise and common user inertia as they can while unable to innovate and thrive in the current market. They don't have vision and they can't conjure up a monopoly.
At some point one group will be right and feel extremely justified in achieving broken clock status of telling the future. Well, the folks who still argue ~2000 was peak and it has been a decline since are at least consistent... even if I agree in some ways and disagree in more in the other ways.
Windows is despite of all this garbage still the de facto standard. Azure is still a way to go thing beacuse so many companies just use office365 and microsoft can be trusted.
If you look at their numbers, they also grew quite fast. That might be more of their motivation though. They added 40k in just 6 years and are now at 230k.
Microsoft is the new IBM.
Google is the new Oracle.
Apple is the new Sony.
Eventually the fact that the US military and government is getting tech support from overseas will catch up. Microsoft is a walking national security disaster.
But all they care about is "line go up next quarter". Their monopoly has made them lazy.
