Microsoft to slow hiring as market dip hits the wider tech industry

Microsoft has reportedly told staff to be more cautious about recruitment, in a bid to slow its hiring amid a global market turndown.

Rajesh Jha, the executive vice president in charge of Office and parts of the Windows team, told staff that they would need to request permission before opening any new job roles, according to a Bloomberg source.

"As Microsoft gets ready for the new fiscal year, it is making sure the right resources are aligned to the right opportunity. Microsoft will continue to grow headcount in the year ahead and it will add additional focus to where those resources go," a spokesperson for the company told CNBC.

While the new fiscal year usually coincides with some reorganisation at Microsoft, the memo is symptomatic of a wider change across the tech industry, as poor market performance for the first half of 2022, and higher inflation, has led to a tightening of budgets.

Chip giant Nvidia is also reported to have called for more caution over recruitment, with the company informing managers over Slack that it is implementing a hiring pause to combat inflation. The internal message was said to stress that it was not a 'freeze' as such, but that only 10% of its next round of interviewees would be offered roles at the company.

The situation appears more brutal in Europe, where a number of high profile tech firms are cutting staff. Swedish payment giant Klarna have announced it's laying off 10% of its workforce. In February, UK startup Hopin made 12% of its staff redundant. Estonian fintech firm Bolt is said to be cutting 100 jobs.

Microsoft's reported calls to slow hiring coincide with a decision to double its budget for employee salary increases. This also includes a raise to the amount of stock compensation it rewards workers with by around 25%. The changes to its payment structure are said to be a strategy for retaining staff by helping them manage the pressures of the global market.