Microsoft says it plans deeper cutbacks in contract workers |
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Microsoft says it plans deeper cutbacks in contract workers
Speaking with Wall Street analysts this morning, Microsoft finance chief Chris Liddell confirmed that the 5,000 job cuts announced today are in the company's full-time workforce, and that the company is planning additional cutbacks among its legions of contract workers. Here's what Liddell said when asked about the situation.
"The outside contractors are not included in that number, and we will be certainly looking to reduce that cost line prob in proportion by more than what we're talking about n terms of internal people. ... External contractors I guess we think about more in terms of the dollars that we spend overall. That's on top of the numbers we're talking about, and that could be down up to 15 percent."
Microsoft doesn't report publicly the number of contractors who work for the company through job agencies. There have already been reports that the company hasn't been renewing many contracts as they come due. Overall, Microsoft said it reduced operating expenses by $600 million in the recent quarter, and no doubt contractor cuts were part of that.
Speaking on the call, Microsoft CEO Steve Ballmer was quick to clarify that, while the company is cutting 5,000 positions, it will still be hiring in other strategic areas. On a net basis, the company's direct employment is expected to decline by about 2,000 to 3,000 people worldwide over the next 18 months. Microsoft hasn't yet said what the effect will be in the Seattle region specifically.
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Todd Bishop is co-founder and managing editor of TechFlash. He has covered Microsoft and the technology industry for more than five years, most recently as a daily newspaper reporter and blogger based in Seattle.
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