Microsoft today announced company wide layoffs that will result in the elimination of 5,000 jobs. The job cuts will take place in R&D, marketing, sales, finance, LCA, HR, and IT over the next 18 months, of which 1,400 will occur today.

In memo to employees Microsoft CEO Steve Ballmer wrote “Our net headcount in these functions will decline by 2,000 to 3,000 over the next 18 months. In addition, our workforce in support, consulting, operations, billing, manufacturing, and data center operations will continue to change in direct response to customer needs.”

Travel expenditures will be cut 20 percent and there will be significant reductions in spending on vendors and contingent staff. Puget Sound campus expansion and marketing budgets will be reduced.