Microsoft is facing backlash online after announcing 4,800 job cuts across its business while continuing to receive approval to hire foreign workers through the U.S. H-1B visa program. The layoffs include approximately 1,600 positions in the Xbox gaming division, prompting renewed debate over whether companies should be allowed to sponsor overseas talent while reducing their domestic workforce.

The criticism has intensified after U.S. government data showed that Microsoft has received approval to hire 2,273 employer-sponsored non-immigrant workers under the H-1B visa program this year, with additional applications still pending.

Why are people criticising Microsoft?

The controversy stems from the timing rather than the numbers alone.

Some critics argue that laying off U.S.-based employees while continuing to sponsor foreign professionals sends the wrong message, particularly amid concerns about the American job market.

Social media users questioned why companies receiving approval for thousands of H-1B workers are simultaneously reducing headcount. On X (formerly Twitter), one user wrote that companies should not be “replacing Americans with visa workers,” while others blamed the U.S. government’s H-1B approval process for allowing such hiring practices.

However, immigration and labour experts note that H-1B approvals do not necessarily correspond to new hiring or direct replacements for laid-off employees.

What is the H-1B visa program?

The H-1B visa is a temporary U.S. work visa that allows employers to hire foreign professionals in speciality occupations requiring specialised knowledge and at least a bachelor’s degree or equivalent experience.

It is widely used across industries such as:

• Software engineering
• Artificial intelligence
• Cloud computing
• Data science
• Cybersecurity
• Finance
• Healthcare

Many of the largest technology companies—including Microsoft, Amazon, Google, Apple, and Meta—regularly sponsor H-1B workers to fill highly specialised technical roles.

Do H-1B approvals mean Microsoft is replacing laid-off workers?

Not necessarily.

There is no public evidence that the employees laid off by Microsoft are being directly replaced by H-1B workers.

Several factors make a direct comparison difficult:

• The layoffs span multiple business units, including Xbox.
• H-1B workers are typically hired for specialised positions that may differ from eliminated roles.
• Approved H-1B petitions can include renewals, transfers from other employers, or extensions—not just new hires.
• Companies often restructure teams while continuing to recruit for critical skills in areas such as AI or cloud infrastructure.

As a result, approval to hire H-1B workers does not automatically indicate that foreign employees are replacing U.S. workers.

Why is the H-1B program under scrutiny?

The H-1B visa has long been at the center of political and economic debate.

Supporters argue the program helps U.S. companies remain globally competitive by allowing them to recruit highly skilled professionals when domestic talent is in short supply.

Critics contend that some employers use the program to reduce labour costs or bypass American workers, although U.S. labour laws require employers sponsoring H-1B workers to meet prevailing wage requirements and comply with Department of Labour regulations.

The issue often resurfaces during periods of large-scale layoffs in the technology sector.

What happens to H-1B workers who lose their jobs?

Layoffs can be especially challenging for H-1B employees.

Unlike many U.S. workers, H-1B visa holders are tied to their sponsoring employer. If they lose their job, they generally have a 60-day grace period (or until their visa expires, whichever comes first) to:

• Find another sponsoring employer,
• Change to a different immigration status, or
• Leave the United States.

Failure to secure new sponsorship within that period can jeopardise their ability to remain in the country.

Microsoft’s restructuring continues

The latest layoffs are part of Microsoft’s broader effort to streamline operations while continuing to invest heavily in strategic areas such as artificial intelligence and cloud computing.

Like several other major technology companies, Microsoft has adjusted its workforce over the past two years as it reallocates resources toward AI-driven initiatives and other long-term priorities.

While the company’s H-1B approvals have fueled online criticism, immigration experts caution against assuming a direct link between visa sponsorships and layoffs without evidence showing that eliminated positions are being filled by sponsored foreign workers.

The debate nevertheless highlights the broader tension between workforce restructuring, skilled immigration, and the evolving hiring needs of the U.S. technology industry.