Microsoft Faces Scrutiny Over Layoffs and H-1B Hiring Practices

Microsoft’s recent round of layoffs at Xbox has reignited criticism over its hiring practices, which critics argue prioritize foreign workers over American employees. The company’s parent, Microsoft, has faced accusations of undermining President Donald Trump’s America First agenda by cutting thousands of American jobs while sponsoring foreign workers on H-1B visas.

The pattern is not new. In 2024, Microsoft laid off nearly 5,000 employees while seeking approval to hire over 2,000 H-1B workers. In 2025, it cut 15,000 jobs while sponsoring 8,000 visa applications. The company has also closed American studios like Arkane Austin and The Initiative, while raising prices for services like Game Pass.

Critics point to Xbox CEO Asha Sharma as a key figure in these decisions, noting her dual role co-leading the Federal Reserve’s task force on Productivity and Jobs. Meanwhile, Trump has taken steps to protect American workers, including a $100,000 fee for H-1B applications from overseas and stricter scrutiny of visa approvals.

Microsoft’s actions extend beyond labor issues. A Homeland Security review highlighted security failures in the company’s government contracts, including a 2023 breach that allowed China to access U.S. government emails. The company’s handling of the Artemis II mission also drew scrutiny after a software glitch disrupted communications.