Microsoft will not give employees salary raise this year: Report

Tech giant Microsoft will not raise salaries for full-time employees this year and is reducing its budget for bonuses and stock awards, Business Insider reported on Wednesday. According to the report, CEO Satya Nadella wrote an email in which he said that last year, the company made a significant investment in compensation driven by market conditions and company performance, nearly doubling its global merit budget. "(But)..this year the economic conditions are very different across many dimensions," Nadella wrote.

In January, Microsoft said it would let go of 10,000 workers in addition to the tens of thousands of layoffs announced last year across the technology sector amid a slowdown in demand due to economic slowdown and fears of recession.

In a communication with employees, Satya Nadella said the firm was living through times of significant change and some customers accelerated their digital spending during the pandemic but they were now optimizing their digital spending to do more with less. "We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one."

"This is the context in which we as a company must strive to deliver results on an ongoing basis, while investing in our long-term opportunity," he said, adding that Microsoft will align its cost structure with its revenue and where it sees customer demand. "Today, we are making changes that will result in the reduction of our overall workforce by 10,000 jobs through the end of FY23 Q3," Nadella said.