Microsoft reported a decline in profits and announced that they will be laying off around 5000 jobs. They are expecting the slow down in profits to continue in the next two quarters. Microsoft’s shares dropped by 11% and this brings their current share value to the lowest, their shares being equivalent to that in 1998.  The world’s largest software maker blames the current weakness of the PC market and the high demand for low cost netbook computers for the dip in the sales of their heavy revenue bringing windows operating system.

Given the high volatility of the current market, Microsoft decided not to disclose its earnings or revenue forecasts for the rest of the fiscal year which will be ending in June 2009.

There are around 95000 employees working for Microsoft and their intent to lay off 5000 employees implies that around 5% of their work force will be eliminated. This is the largest planned lay off for the software maker till date. Investors are looking for more safer and secure assets in today’s economic crisis. This combined with Microsoft reporting declining profits has sent the value of the dollar down along with the Nasdaq index.

Times are changing indeed. With this, insecurity in the job market has increased and prospects of a turn around in the economy any time are looking bleak.