Microsoft’s AI Push Costs Software Engineers Their Jobs
Microsoft’s recent layoffs have hit software engineers particularly hard, with over 40% of job cuts in Washington state affecting this group, according to a Bloomberg analysis. The company announced global cuts affecting roughly 6,000 employees. Ironically, some of these engineers had been working on integrating AI tools into their workflows just months before their dismissal.
Jeff Hulse, a Microsoft VP overseeing 400 engineers, had directed his team to use OpenAI-powered chatbots to generate up to 50% of their code. Weeks later, his team was among those laid off. This sequence of events raises questions about whether these engineers unwittingly trained their own replacements. Microsoft CEO Satya Nadella has praised AI’s productivity benefits, noting that it writes nearly a third of the company’s code in some projects.
The layoffs weren’t limited to junior coders; employees in product management, technical program management, and AI projects were also affected. Gabriela de Queiroz, Microsoft’s Director of AI for Startups, publicly confirmed her dismissal, expressing grief for her colleagues who “cared deeply, went above and beyond.”
While Microsoft claims the restructuring aims to remove management layers, the numbers suggest otherwise. Only 17% of Washington layoffs were managers, mirroring the company’s overall managerial ratio. The real driver appears to be cost-cutting amid significant AI investments, including data center expansions and OpenAI partnerships.
For many engineers who lost their jobs, the hardest part is knowing they helped Microsoft transition to AI-driven development, only to be let go because of it. The layoffs have sparked protests, including an incident at Microsoft’s Build 2025 event where an employee disrupted proceedings to condemn the company’s contracts with the Israeli government.
