Does it really make a difference?

When Google offered buyouts to employees last year, software engineer Jim Laskey was close to taking the offer. So close that he actually applied for the buyout but then later withdrew his application.

But after the first buyout program lapsed, Laskey said the focus of his work changed. Though he said he kept his job to continue working on projects he cared deeply about, they were eventually abandoned as his team pivoted to be more focused on artificial intelligence.

So when Google opened another buyout round earlier this year, Laskey didn’t second-guess himself. Despite pushback from his managers, Laskey left Google after more than nine years at the company. He told SFGATE in an interview that “a lot had changed in that one year, and the time was finally right.”

“I decided that that was not the kind of job that I had signed up to do,” Laskey said. “It was not what I enjoyed about the tech.”

When companies cut costs through layoffs, workers typically don’t get a say. And over the past year, when more than 195,000 tech jobs have been slashed, the reality of a layoff has hit many. The process is often abrupt, with workers only finding out their jobs were eliminated from an email from human resources or waking up one morning to find they are locked out of company accounts. While there is a less brutal way to trim staff costs — a buyout where employees are enticed to leave their jobs with a severance package more generous than what they’d get with a layoff — that alternative is rare. And it’s especially rare at the scale Microsoft announced last week, where the tech giant made 27% of its global workforce eligible to participate.

In theory, buyout programs are better for morale because they give workers an opportunity to leave on their own volition. But in a brutal job market, particularly for tech in the AI age, workers mulling a buyout still face a difficult choice: take a chance on finding a new job with some extra cushion or stay at the company, only to risk losing a job anyway.

“Anyone who’s new to the industry is really going to have a hard time finding work. I have not seen any postings for anything less than four years of experience,” said a Microsoft employee who took last week’s buyout. SFGATE granted the employee anonymity in accordance with Hearst’s ethics policy. “I feel like I’m in a pretty good spot. If I was later in my career, it would probably be also a decent spot. For anyone in that four to five years and lower, I think it’s gonna be tough.”

There’s also an incentive for companies to seek the buyout route instead of going for layoffs first, as it’s better for optics. 

Though it achieves the same goal as a round of layoffs by reducing head count, a buyout program has a positive connotation in the job market, said UCLA Anderson School of Management Professor Emeritus David Lewin. Prospective applicants look more favorably on a company offering buyouts versus a company announcing layoffs. He added that former employees may be more willing to work with Microsoft in the future as a vendor, for example, because they don’t harbor as much resentment. 

“It’s a win-win for Microsoft,” Lewin said. “It’s getting its workforce reduction objective accomplished, and it’s a win for the employee who gets a buyout amount of money and can go work somewhere else.”

A buyout program can also avoid the negative impacts on morale that layoffs cause. After Google announced a major workforce reduction in 2023, laying off 6% of its global staff, Laskey said work would often become more competitive between departments. Employees would often fight to keep projects alive out of fear that losing them could mean losing their jobs. Though some employees were gone, their workloads weren’t, making it more stressful for employees having to take on more work or track down the pieces of affected employees’ work, Laskey said.

But beyond the usual grind, the experience of losing colleagues is just “brutal,” he said. 

“It’s so painful,” Laskey said. “You woke up one day, and you could not reach people. They just disappeared.”

Taking a buyout can also be a strategic move for an employee.

Kyle Elliott, a tech executive career coach in Santa Barbara, told SFGATE that one of the biggest incentives is the pay. For people who find a job quickly, they can actually receive some dual income.

“It’s really an opportunity for employees, those executives and managers, to be more empowered and make a decision rather than just being impacted by a layoff and waking up and not being able to log into their laptop at 4 a.m.,” Elliott said.

Ben Tobin, a tech career coach in Portland, Oregon, told SFGATE that buyouts allow workers to have more time on their hands to search for jobs, instead of trying to cram application work after hours. It’s an abysmal time to be searching for a job in tech, but at least during a buyout round, job seekers aren’t competing with thousands of other colleagues who also just lost employment like in the aftermath of a mass layoff, Elliott said.

Elliott recommended that prospective applicants not shy from being honest with recruiters about the nature of their previous exit — whether it was a layoff or a buyout doesn’t really matter to them. Recruiters are really looking to weed out people who were fired for cause at their last job, so Elliott encourages people to include lines on their resumes explaining the nature of their exit.

“Tech layoffs are just understood as part of the industry. They know that people get laid off. They know that people take buyouts,” Elliott said. “There is a difference if you get fired.”

The Microsoft employee who took the buyout last week told SFGATE he was already considering leaving before he took the offer. 

For the employee, the choice came down to several factors. He saw this program and an earlier voluntary retirement program this year as a precursor to layoffs, just without knowing the scale of what could come. 

The staffer said these moves by the company have made work feel unstable, which could be made worse due to an increasing workload with reduced staffing. He added that because the buyout program was made available to only certain areas at Microsoft, it was natural to assume that those areas could face further reduction if not enough people took the buyout. He said his boss was also going to cash out.

“I was already looking for a different role, something that had a better work-life balance and that I could see myself working at for a longer period of time,” the employee said. “It’s the same question: ‘Can I get a job within six months?’ I feel like I’m a pretty decent candidate, and I’m pretty flexible in what I’m willing to take on, so I think the answer is yes.”

The employee has since ramped up his job search. Last month, he applied to only one or two jobs, he said. Just this week, he’s applied to eight. While he was confident that he would land something new, he acknowledged that the search may not be as easy for someone with less experience. 

With that in mind, he sees his own exit as helping prevent a colleague from having their job taken from them — especially since he had a foot out the door anyway.

“It’s nice timing for me. I’m the right kind of person for this,” he said. “I also appreciate that they do this option, which means that if I quit, someone else doesn’t have to lose their job.”

Contact tech reporter Matthew Brown at [email protected] or matthewbrownsfgate.11 on Signal.