Microsoft in Ireland: How the tech giant has developed in four decades

Reports that Microsoft is preparing to cut thousands of jobs worldwide will be causing some unease at its Irish operations where the company employs more than 3,000 people.

The company last year cut a small number of roles from its 221,000 staff worldwide, according to reports, but at less than 1,000 employees, the lay-offs were significantly less than the 11,000 that are expected to go in this new round of cuts.

If it comes to pass, the tech giant will become the latest in a growing list of tech businesses to announce deep cuts in staff, following announcements by Meta, Twitter, Salesforce and Stripe on shedding jobs.

The company has a lot of history here. Microsoft opened its doors in Ireland in 1985, with a small manufacturing operation that employed less than 100 people.

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Over the past four decades, things have changed significantly. These days, Ireland is the home to Microsoft’s Europe, Middle East and Africa operations centre, a development centre, sales and marketing services for the island of Ireland, and data centre operations.

At the last count, it employed 3,500 people here, a figure that doesn’t include those at professional networking platform LinkedIn, which it bought in a $26.2 billion deal in 2016.

The company opened its campus, which includes the flagship One Microsoft Place, in Leopardstown in 2018. The ambitious project was part of a €134 million investment in Microsoft’s operations here, and was a major move for the company. Although the focus was on the LED waterfall and digital lake, an indoor “mountain” and on-site gym facilities, the importance of the building for Microsoft went beyond that, bringing all its employees under one roof for the first time, and giving Microsoft space for additional facilities for research, innovation and education.

The One Microsoft Place building includes Microsoft’s Dream Space, an innovation and education hub designed to teach the next generation about technology. When it initially opened more than four years ago, the facility had committed funding of €5 million and hoped to reach 100,000 primary and transition year students; in October last year, Microsoft said it would invest €3 million in expanding the hub over the following four years. During Covid, it continued to operate with online and virtual sessions replacing the in-person programme.

The campus was set for further development a couple of years after it opened, with Microsoft announcing in 2020 it would invest €27 million in a new engineering hub located alongside the main building. At the time, the Irish operation employed 600 engineers; the investment also would see that number expand by a further 200.

In 2021 the company expanded staff again, with the announcement of 200 new digital sales jobs in Dublin. That would bring to 1,200 the number of people employed in the EMEA digital sales centre, which was set up in 2017.

There have been several changes in the past few years too. Cathriona Hallahan, Microsoft Ireland’s managing director and its longest serving employee departed in 2021, with former Vodafone enterprise head Anne Sheehan taking up the role. James O’Connor, the vice president of Microsoft International Operations, is site leader for Microsoft Ireland.

Like many tech companies, Microsoft saw some benefit from the Covid-19 pandemic that spurred digital transformation among Irish businesses. The most recent accounts for its main Irish business, Microsoft Ireland Operations Ltd (MIOL), showed the company recorded a profit of $3.1 billion (€2.87 billion) in the 12 months to June 30th 2021, with revenues of $56.2 billion that were almost $10 billion higher year on year.

The increase in revenue was seen across all lines of its business, from intelligent cloud and personal computing to productivity and business processes.

But as energy prices have risen and the cost of living has spiralled, even tech companies have found they are not immune to macroeconomic factors. Microsoft was among the tech companies that hit pause on hiring last year, and lost some jobs amid restructuring and cost cutting. Among the roles expected to hit by the new cuts are human resources and recruitment, and engineering.

Should it decide to cut staff here, the company will have to enter a consultation period with employees, meaning the full extent of the cuts may not be known for a few weeks, adding to the gloom being felt in the tech sector.