More than 90,000 tech workers have been laid off this year. But here’s why companies like Microsoft are offering voluntary buyouts instead
It’s been a tough year for tech workers. Some 92,000 employees have been laid off from tech companies as they look to cut overhead costs and invest heavily in AI. Meta announced on Thursday that it plans to cut 10% of workers, or roughly 8,000 employees, to improve efficiency and offset its AI spending. The social media giant also plans to leave 6,000 open roles unfilled. Microsoft also announced on Thursday plans to slash its workforce, but is taking a different approach: its first ever buyout for experienced workers. The company is offering voluntary separation to 7% of its U.S. workforce—more than 8,500 employees—whose years of service plus age total 70 or more. In the past, Microsoft hasn’t been shy about laying off employees and cut 15,000 jobs last year. But management is jumping on an increasingly common trend of offering voluntary separation instead of laying people off, said Domenique Camacho Moran, a lawyer and partner at employment law firm Farrell Fritz. Her firm represents Fortune 500 companies, large universities, and several middle market businesses. A buyout is a way to support good and loyal workers and avoid the devastating blow of being laid off while ultimately cutting jobs. By contrast, layoffs can be more complicated, requiring an evaluation of each employee’s skill set and performance to avoid litigation risk, Moran said. “The voluntary exit option gives the employer the ability to say, ‘it’s not about the fact that we don’t think you’re doing a good job, but if you’re thinking about it’s time for me to move on. I’m going to incentivize you to do that because we need to cut some staff,’” she said. The growing popularity of buyout speaks to businesses deciding they need fewer employees because of AI and financial pressures, according to Moran. Microsoft is expected to invest $145 billion in capital expenditure this fiscal year as part of a $700 billion wave in capital expenditures for 2026 from big tech