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Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times reporter Sharon Chan.

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January 22, 2009 7:22 AM

Majority of today's Microsoft job cuts to be in Redmond; total reduction is roughly 3 percent

Posted by Benjamin J. Romano

A Microsoft spokeswoman confirmed via e-mail this morning that "the majority" of the 1,400 job cuts Microsoft is announcing today are in Redmond, "consistent with the high concentration of employees based at our headquarters in the Puget Sound area."

Beyond that initial blow, the company's broader layoff plan is rather modest. It plans to cut up to 5,000 positions over 18 months while adding new staff for a net reduction of 2,000 to 3,000 jobs. The company now has roughly 96,000 employees the world over, the spokeswoman said, meaning at the high end, this is a net reduction of 3.1 percent.

In 2007, Microsoft CEO said the company's normal rate of attrition is about 8 percent a year. Of that, he said, about 3 percent is "good attrition" -- meaning low-performing workers who leave or are nudged out. Naturally, attrition rates tend to slow during bad economic times as people hang on to their jobs, but the bottom line is Microsoft is reducing its work force by roughly the rate at which its low-performing workers leave the company anyway.

More coverage of Microsoft's cost-cutting

Microsoft laying off 1,400 today, up to 5,000 in next 18 months

Ballmer's e-mail to employees
Contractor spending could be cut up to 15 percent
Attention turns to what groups will see cuts
Gregoire calls layoffs "disheartening"

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