KEY POINTS

• Microsoft says about 60,000 employees in the US, Canada, India and the UK are eligible for a voluntary buyout programme.
• American Express plans to cut 5% of its global workforce, while Barclays expects to eliminate about 5,000 jobs.
• The companies say the changes will improve efficiency, simplify operations and free up money for investment.
• US unemployment benefit claims have fallen, but more than one in four unemployed Americans had been out of work for at least six months in September.

MAIN STORY

Microsoft has offered voluntary buyouts to about 60,000 employees as it seeks to make its operations more efficient amid the growing adoption of artificial intelligence (AI).

The programme covers eligible employees in the United States, Canada, India and the United Kingdom, according to the company. Eligibility is limited to employees at experience level 70 or below.

Amy Coleman, Microsoft’s executive vice president and chief people officer, said the offer would give employees more flexibility as the company changes how it operates.

The programme also builds on lessons from Microsoft’s voluntary retirement programme earlier in the year, Coleman said in a staff memo.

Employees who accept the offer must make their decisions within the coming weeks and are expected to leave the company at the end of the year.

Microsoft’s move follows job-cut announcements by American Express and Barclays, which have also pointed to AI adoption and organisational changes as part of efforts to reduce costs and improve productivity.

American Express plans to eliminate 5% of its global workforce. The company had about 77,000 employees at the end of last year, meaning the reduction could affect roughly 3,850 jobs if calculated against that workforce figure.

Chief Executive Officer Stephen Squeri said the company needed to become more agile and efficient to accelerate innovation and remain competitive over the coming years.

He added that the restructuring was intended to improve execution and create more room to invest in the company’s priorities.

Barclays, meanwhile, plans to cut about 5,000 jobs as it uses technology and organisational changes to reduce costs. The bank disclosed the plans alongside its third-quarter results.

About 60% of the planned reductions are expected to affect support functions, including developers, according to the bank’s earnings presentation. Chief Financial Officer Anna Cross said approximately 1,000 positions had already been eliminated, with another 4,000 expected to be cut before the end of the year.

The announcements come against a mixed picture in the US labour market. Initial applications for unemployment benefits fell by 6,000 to a seasonally adjusted 194,000 in the week ended October 17, according to the US Department of Labor. That was the lowest level since July.

However, the number of Americans who had been unemployed for at least 27 weeks remained high at about 1.94 million in September, representing 27.1% of all unemployed workers, according to the Bureau of Labor Statistics.

THE ISSUES

The announcements show how companies are using AI and other technology changes as part of broader efforts to control costs and reorganise their workforces. But the figures do not establish that AI alone is responsible for every job reduction.

Microsoft’s programme is a voluntary buyout offer, which differs from an announcement that employees will automatically lose their jobs. Its eventual effect on the workforce will depend on how many eligible employees accept.

For workers, the changes raise questions about which roles companies will continue to need as they automate tasks and reorganise teams. Barclays’ plans also show that technology-related restructuring can affect people who support business operations, not only employees in traditional technology roles.

The US employment figures highlight another concern. Fewer people are applying for unemployment benefits each week, but a significant share of those already out of work are struggling to find new jobs. A lower number of new claims does not necessarily mean that unemployed people are quickly returning to work.

WHAT’S NEXT

Microsoft employees eligible for the buyout will decide whether to accept the offer in the coming weeks, with departures expected at year-end. Barclays also expects to complete its workforce reductions by the end of the year.

The eventual number of employees leaving Microsoft under the programme is not yet established by the information provided. The longer-term employment effects of AI adoption will also depend on how companies change their operations and whether new roles emerge alongside tasks that technology can perform.

BOTTOM LINE

Microsoft’s offer to 60,000 employees, alongside planned job cuts at American Express and Barclays, reflects a growing effort by major companies to improve efficiency as AI reshapes business operations. Yet falling unemployment benefit claims do not tell the whole story: millions of Americans who have lost their jobs are still facing prolonged periods without work.

Source: Yahoo finance