Microsoft’s GitHub slashes headcount by 10% and reduces costs

Microsoft-owned software development platform GitHub has announced that it plans to cut 10% of its workforce, requiring the remainder of its employees work from home to cut costs.

According to reports, the move is intended to safeguard the firm’s immediate stability and protect the short-term health of its business.

The firm – which is treated as a separate entity to Microsoft’s business –  now joins a growing number of tech businesses such as Amazon, Google, Zoom and Dell who have slashed staff numbers in recent weeks amid the current economic instability.

GitHub CEO Thomas Dohmke sent an email to all employees on Thursday informing them of the changes.

“To start, we will align our work with the areas where we can best impact these goals and our customers’ needs across all of our products. Unfortunately, this will include changes that will result in a reduction of GitHub’s workforce by up to 10% through the end of FY23,” Dohmke wrote in his email.

The company said the estimated 300 outgoing employees will receive severance packages and career transition assistance services.

Of the fully remote work environment to reduce costs Dohmke added: “One of our decisions is to move toward a fully remote GitHub. We are seeing very low utilisation rates in our offices around the world, and this decision is a testament to the success of our long-standing remote-first culture.”

The company also announced plans to increase its laptop refreshing cycle and move to Microsoft Teams for all video collaboration as an added approach to cutting costs.

The decisions are “difficult but necessary”, said a GitHub spokesperson, and will go some way to grant GitHub the capacity to invest in its long-term strategy moving forward.

The layoffs come just under a month after the company imposed a hiring freeze.

Microsoft controversially bought the well-regarded open source software development platform in 2018 to ramp up its focus on open-source development and enterprise use of GitHub, as well as bringing MS developer tools and services to new audiences.

GitHub now offers a wider product portfolio, which includes projects such as cloud-based developer environment CodeSpaces as well as its file context analyser Copilot, which is powered by Codex – a tool from ChatGPT creator OpenAI.