GitHub lays off 10% of workforce, plans to go fully remote to cut costs

GitHub, the software development and version control service provider owned by Microsoft, announced it would be cutting 10% of its workforce and transitioning the remaining employees to remote work in order to safeguard the company’s immediate financial stability.

“We announced a number of difficult but necessary decisions and budgetary realignments to both protect the health of our business in the short term and grant us the capacity to invest in our long-term strategy moving forward,” a GitHub spokesperson said in an email statement.

On Thursday, GitHub CEO Thomas Dohmke sent an email to employees informing them about the upcoming changes including the layoffs.

“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 estimated 300 outgoing employees, which constitutes close to 10% of the company’s 3,000 workforce, will receive severance packages and career transition assistance services, the company said.

The layoffs, which were first reported by Fortune, come short of a month after the company put a hiring freeze on January 18, which continues to be in effect.

More cost reduction efforts

To reduce costs further, GitHub, according to Dohmke’s email, will move to a fully remote work environment.

“One of our decisions is to move toward a fully remote GitHub. We are seeing very low utilization rates in our offices around the world, and this decision is a testament to the success of our long-standing remote-first culture,” Dohmke wrote in his email. 

However, the company said it will not vacate its offices until their leases end.

In addition to going remote, the company plans to increase its laptop refreshing cycle and move to Microsoft Teams for all video collaboration in order to drive costs down even further.

“Effective immediately, we will be moving laptop refreshes from three years to four years,” Dohmke wrote, adding that the move to Teams is expected to be completed by September.

GitHub will continue to use Slack for day-to-day collaboration, the company said.

Large technology companies including Microsoft, Oracle, Google, Amazon and Meta have continued to lay off employees since August last year.

Last month, GitHub-parent Microsoft announced the company’s plans to lay off 10,000 employees.

Layoffs at technology firms have continued in the new year with these companies laying off more employees than in any other month since the start of the COVID-19 pandemic.