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Microsoft employees are not getting pay raises this year and bonuses will be smaller, too

Microsoft will not give raises to full-time employees this year and is cutting back on bonuses and stock awards, too, as revenue growth slows.

“As part of that effort, we are funding our compensation to align with the overall market,” Microsoft said. “While we will not be providing salary increases for our full-time salaried employees this year, we will continue to invest in our employees through promotions, bonus and stock.”

That platform shift is capitalizing on the growing interest in artificial intelligence, according to an internal email from CEO Satya Nadella obtained by Insider.

“Last year, we made a significant investment in compensation driven by market conditions and company performance, nearly doubling our global merit budget,” Nadella wrote. “This year the economic conditions are very different across many dimensions.”

In January, Microsoft said it would cut 10,000 jobs, just shy of 5% of its workforce.

Last year Microsoft nearly doubled the budget for performance bonuses. This year will look more like business as usual, Nadella wrote. Microsoft’s top executives will also feel the pain, he said.

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