Report: Microsoft tying to move towards AI agents amid mass layoffs

Microsoft is going through another round of mass layoffs with 9,000 employees in various divisions being let go. While the management has called these layoffs organizational changes, a new report citing a developer with knowledge of the situation claims that Microsoft is looking to replace its human workforce with AI.

Speaking at Meta’s inaugural LlamaCon AI developer event in May, Microsoft CEO Satya Nadella had shared that about 30% of the company’s code is written by AI. Now, it looks like the company is going full steam ahead with AI integration and this could have something to do with the recent mass layoffs. A report by Engadget citing a developer at Microsoft who also received the memo from Phil Spencer, but supposedly was not let go, shared that management is “trying their damndest to replace as many jobs as they can with AI agents."

While the report does not elaborate on this claim, the memo stated “increase agility and effectiveness” as one of the reasons for the layoffs. If implemented correctly, AI agents can significantly optimize various workflows so the developer’s claim of Microsoft trying to replace human workers with AI agents surely has weight to it. This has become an industry trend as even Amazon had recently issued a memo to its employees stating that AI agents will replace some human jobs.

Furthermore, the developer also shared his anger about the memo and the current situation of development at Microsoft. “I'm personally super pissed that Phil's email to us bragged about how this was the most profitable year ever for Xbox in the same breath as pulling the lever. I wasn't sure what part of that I was supposed to be proud about,” the developer reportedly told Engadget. They added that employees at Microsoft are not happy about the quality of the product and that a lot of pep talk is being used to try and up the morale.

It should be noted that Microsoft has not associated AI agents with the mass layoffs but considering the AI-written code, using generative AI in Call of Duty: Black Ops 6, and other AI related internal implementations, AI agents seem to be the end goal for the company.