In a recent development, Microsoft’s professional social media platform, LinkedIn, revealed a fresh round of job cuts that will impact approximately 3% of its workforce, translating to 668 employees. These layoffs encompass various departments, including engineering, product, talent, and finance teams.
LinkedIn’s decision to initiate another round of layoffs comes against the backdrop of the company’s consistent slow year-over-year revenue growth over the past eight quarters. Despite experiencing a steady increase in its membership base over the last two years, Microsoft’s quarterly revenue report for the second quarter, released in July, indicated a mere 5% growth. In response, Microsoft has outlined its strategy to boost revenue by focusing on operational improvements and prioritizing key initiatives, and the recent job cuts at LinkedIn are aligned with these plans for FY 24.
In an official blog post, LinkedIn acknowledged the difficulty of talent changes but emphasized their necessity, announcing, “The changes we shared with our team today will result in a reduction of approximately 668 roles across our engineering, product, talent, and finance teams.”
Microsoft’s latest round of layoffs at LinkedIn mirrors a broader trend in the tech sector, where companies are grappling with slowing revenue growth and an uncertain economic outlook. These layoffs, affecting 3% of LinkedIn’s workforce, follow the 10,000 job cuts announced by Microsoft earlier in the year, reflecting the company’s overarching efforts to cut costs and prioritize revenue.
According to an official memo shared with CNBC, LinkedIn’s executives Mohak Shroff and Tomer Cohen emphasized the need to evolve their work processes and priorities as part of the FY24 plan, adapting organizational structures for improved agility, accountability, and efficiency while reducing layering.
While these layoffs are taking place, LinkedIn is reportedly expanding its hiring efforts in India, demonstrating its commitment to strategic priorities and delivering value to its members and customers.
Notably, the tech sector as a whole has witnessed a surge in job cuts in recent months, with companies like Amazon, Meta, and Google all making similar announcements as they brace for the potential challenges posed by an uncertain economic landscape. According to a report by employment firm Challenger, Gray & Christmas, the tech sector saw a substantial increase in layoffs, with 141,516 employees affected in the first half of 2023 compared to about 6,000 in the previous year.