Cisco announced on Tuesday that it will layoff 9% of its workforce, or 6,500 jobs, in an effort to boost profits. That figure is lower than original speculation that the company would cut 10,000 employees. Cisco made the move as part of an effort to cut $1 billion in annual costs while spurring profit growth, Bloomberg reported. 2,100 of the 6,500 employees have agreed to an early-retirement program. Additionally, Cisco plans to sell a Juarez, Mexico-based manufacturing facility to Foxconn. The move will transfer 5,000 workers elsewhere but will not result in job cuts. Earlier this year, the company laid-off 550 additional employees when it announced that it was killing off its Flip camera arm in an effort to restructure its consumer business. More →
L.M Ericsson Telephone Company unexpectedly announced on Tuesday that it is laying off almost 1,000 employees in its native Sweden due to a 74% drop in net profits one quarter back. Ericsson is reportedly closing operations in the town of Gävle, a design and manufacturing facility that employs 856 people. They’re also slashing almost 9% of the workforce in the Borås facility, laying off 90 of the 1,037 employees. It is not surprising that much of this loss is attributed to falling sales with its joint venture with Sony. With software problems plaguing Sony Ericsson’s flagship Satio and both the upcoming Sony Ericsson X2 and X10 reportedly not slated for launch until 2010, things might be looking worse before they look better. More →
Microsoft has allegedly sent out a notice to former employees (those who were recently laid off) to come back so they can pour a little bit of salt in their wounds. Apparently, human resources in Redmond made a little oopsie and overpaid severance for some ex-workers. According to the notice, the folks in question have two weeks to send a check or money order back to Microsoft to cover the overage. The error may have also caused underpayment of severance for other former employees. This isn’t shaping up so well for Microsoft and for those who are being forced to send in payments to correct an HR error. Imagine receiving news of your impending layoff and then being sent packing with your check, only to receive a notice later that effectively reads, “Our bad. Send some of that money back, please.” No official word from Microsoft as to when the error occurred and why.
Despite solid Q4 2008 earnings, Verizon Wireless is apparently not layoff-proof in this struggling economy but then no company is. Rumor has it that Verizon is in the process of an unannounced work force reduction that began yesterday, February 9th. The rumored layoffs will continue through the end of the month and will affect an unknown number of employees from management level down. As always is the case, low performing employees and those facing disciplinary action are at the highest risk of losing their jobs. This is certainly a difficult economic time and even successful companies may be prompted to let employees in an effort to minimize the impact of the downturn. We hope that this rumor is not as dire as it seems but if it does pan out our condolences are certainly with all who are affected.
UPDATE: Here’s what we think happened after talking with some people in the know… it seems as if this is concerning employees associated with Circuit City (estimated at around 240). Since they are Verizon Wireless employees, Verizon is said to have tried and relocated as many of them as possible to other stores, etc. We’re told that the employees that were let go got severances packages including outplacement services to help them find other employment.
Sprint Nextel announced a plan today to reduce internal and external labor costs by $1.2 billion by eliminating 8,000 positions within the company. The layoffs are expected to be completed by March 31st and will effect all levels of the company. Of the 8,000 positions eliminated, 850 are part of the voluntary separation plan announced late last year. In addition to the layoffs, Sprint is also suspending the 401(k) matching program for 2009, extending the 2008 salary freeze through 2009 and suspending its tuition reimbursement program for the duration of 2009. Bad news for Sprint Nextel, even worse news for its employees. Our sympathies go out to those who will be affected by this difficult news.
Best Buy reported on Tuesday its earnings for Q3 2008 which, despite a strong Black Friday showing, were abysmal. Best Buy pulled in a meager $52 million in earnings or 13 cents per share which is a 77% drop from the same quarter last year during which Best Buy raked in earnings of $228 million, or 53 cents a share. Best Buy did not even come close to meeting Wall Street’s expected earnings of 24 cents per share which were adjusted downward from Q3 2007 to reflect the slowdown in the economy. As result of this poor Q3 2008 showing, Best Buy CEO Brad Anderson has announced that Best Buy will be offering voluntary buyouts to all 4,000 of its employees. If a sufficient number of buyouts are not taken, then layoffs may ensue. In addition to cutting back on its workforce, Best Buy also plans on cutting expenditures in half and delaying new store openings. Not so good end of the year news for Best Buy and its employees but as always, we feel for all of those who will be affected by this announcement.