Bloodiest job cuts in tech history
An internal Microsoft memo revealed that the software giant is cutting 14 percent or 18,000 of its workforce. Over the years, Microsoft has amassed 127,000 employees, with 30,000 coming from its acquisition of Nokia. New CEO Satya Nadella wants to streamline Microsoft operations, starting off by removing redundant positions. Of the 18,000 jobs to be cut, 12,500 will be cut from its Nokia division. The first 13,000 cuts will happen in the next six months. Nadella assures its employees that all those affected by the job cut will be properly compensated.
The massive layoff is expected to be formally revealed in its July 22nd live earnings call.
This is deemed as the bloodiest layoff Microsoft has ever faced, but it is not the worst mass layoff the tech industry has witnessed.
In 2012, Hewlett-Packard announced that through the end of 2014, it will be laying off 27,000 employees as part of its restructuring plans. But if you consider HP’s worldwide workforce of 349,600 people, 27,000 is a relatively small percentage, albeit it troubling.
Microsoft and HP are just two of the biggest tech companies who severed their ties with thousands of its employees. Let’s look at how others in the tech industry compare to their massive layoffs.
Biggest layoffs in tech’s recent history
Cisco
In 2011, Cisco announced plans to reduce its 73,408 workforce by 11,500. Of the 11,500 employees, 5,000 were turned over to Foxconn International Holdings Ltd. who bought the company’s set-top box plant in Juarez, Mexico. Which meant that the 5,000 employees weren’t left jobless. The remaining 6,500 employees, which accounted for nine percent of Cisco’s total workforce, cost the company a whopping $1.3 billion or more to cover severance and retirement pay.
BlackBerry
Then called Research in Motion (RIM), the Canadian company announced in 2012 that 5,000 of its employees will be laid off as it restructures in order to bounce back from falling mobile sales. Then CEO Thorsten Heins stated that after the layoffs, the company will still have a workforce of about 11,500. A year before, it cut 2,000 from its workforce, which affected some of its top executives.
Sony
Sony announced earlier this year that it will be reducing its global workforce by 5,000, as it expected massive revenue loss. Sony has greatly failed to compete with Apple’s mobile devices and the thousands of other Android mobile devices out in the market. The layoff includes 1,000 of its US employees, 1,500 in Japan, and 2,500 more from its global workforce.
Along with the layoff comes the closing of 20 retail stores in the US, laying off an undisclosed number of its UK developers, and selling its Vaio PC business to Japan Industrial Partners. The massive layoff is expected to cut the company’s expenses by one third over the next months before the 2015 fiscal year starts.
Motorola Mobility
Before Google decided to sell Motorola Mobility to Lenovo for $2.91 billion, the search giant trimmed down its workforce to cut losses. First, it booted 20 percent, or about 4,000 of its worldwide workforce in 2012, as part of its restructuring plan in the hopes of becoming profitable once again. This was followed by another 1,200 employees getting laid off in 2013 to further reduce operating expenses.
IBM
Reports have surfaced that IBM is going to cut 13,000 to 15,000 of its global workforce in 2014. According to people with knowledge of the job cut, the round of cuts has been dubbed as “Project Apollo.” IBM CFO Martin Schroeter, who did not disclose how many jobs were officially at stake, claimed that the company plans on spending $1 billion, plus or minus $100,000 million in cutbacks this year.
Over the years, many IBM employees have been shown the door but Big Blue has a knack for keeping mum amidst its layoff process, never fully disclosing how many employees have been booted. Alliance@IBM, an unofficial IBM employee organization, has been reporting job cuts of hundreds to thousands from IBM’s worldwide operations since earlier this year.
images by misterbisson and woodleywonderworks via photopin cc
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