We received a tip last week, from a usually reliable person, that Microsoft would be making more job cuts this week. The company so far isn't commenting, and we haven't been able to get confirmation elsewhere. But independent of our inquiries, the online buzz increased over the weekend to the point that Microsoft employees will no doubt be a little nervous when they check their email tomorrow morning.
"Rumors of more Microsoft layoffs being announced on May 5th," wrote former Microsoftie Jeff Erwin in one of several posts on the subject by people on Twitter and elsewhere. "Lots of panic in the employee base."
If they happen, it's not clear if the new cuts would simply follow through on Microsoft's previously announced cutbacks or add to the expected total. Microsoft said in January that it would cut up to 5,000 positions over 18 months, starting with an initial wave of 1,400 layoffs.
That decision, spreading the possible job cuts over such a long time frame, went against the popular business philosophy of cutting once and cutting deep. The extended time frame puts morale at risk, putting people on edge and making them worry that their jobs are in jeopardy -- as evidenced by the tone of the latest online posts. That effect could intensify if further cuts are announced this week.
The latest buzz follow last month's prediction from Seattle-based analyst Sid Parakh of McAdams Wright Ragen that Microsoft would make cuts over and above its initial plan. Parakh accurately predicted the initial round of layoffs, despite slightly overestimating the size.
We're continuing to dig into this and will publish updates as more details emerge.
Update, 8 a.m.: Here's the official word from Microsoft spokesman Lou Gellos: "As we said in January, and noted in our Q3 earnings call, we will continue to assess the market and economic situation over the next 18 months and make adjustments as needed. Beyond that, we have no other details to share."
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