Intel on Wednesday became the latest technology giant to shed jobs in the face of an economic downturn that has already seen millions of people lose their jobs. The company said it plans to restructure its older manufacturing operations without impacting the deployment of new, leading-edge 45-nanometer and 32-nanometer technology.
Up to 6,000 Jobs at Stake
Two assembly test facilities in Penang, Malaysia, and one in Cavite, the Philippines, will be closed. Intel also will halt production at Fab 20, an older 200mm wafer-fabrication facility in Hillsboro, Ore. In addition, wafer-production operations will end at its D2 facility in Santa Clara, Calif.
The production halts at the four sites, combined with associated support functions, are expected to affect between 5,000 and 6,000 employees worldwide. However, Intel said some employees might be offered positions at other manufacturing sites. The reductions will stretch though the end of 2009.
“The Intel announcement wasn’t a great surprise,” said Charles King, principal analyst at Pund-IT. “Intel had a severely disappointing quarterly announcement and indicated that they were going to be looking for places to cut expenses and costs, which means job losses. This shows how interconnected the component manufacturers [are] in the PC industry.”
An Uncertain 2009
The world’s largest chipmaker posted a 90 percent decline in its fourth-quarter profit and a 23 percent decline in revenue. The company hasn’t reported a loss since 1986, but its CEO is warning that first-quarter results could include losses.
“We are not going to wake up in six months with everything rosy again,” Intel CEO Paul Otellini told employees last week. After 87 quarters of profit, Intel said the first quarter is “too close to call.” Intel said last week it expects to return to healthy profit levels by the second half of 2009.
While Microsoft and Intel expect layoffs, Apple and IBM offered hope for…