12,000 jobs to go. Intel refocusses itself.

Retrenchments, large scale ones are always frowned upon. However, with changing trends, these corporate restructuring will be more and more common. Perhaps more importantly is to understand what could we do should the job we currently have is lost forever. Increased globalisation meant organisations could choose to relocate or locate their plants where the costs are lowest. For businesses suffering from a decline of an industry, it has to quickly refocus itself or it may disappear in the future. One piece of bad news was reported in many medias today.

Intel announced that it will be cutting around 11 percent of its global workforce. This is supposed to be up to 12,000 staffs. This cut is meant to help Intel refocus its business from a PC company to one that powers the clouds and billions of smart, connected computing devices. Most of these affected employees would know their fate within 60 days while the rest will wait until 2017. With such a huge number, my friend working in Intel has this to say, “12,000 is a big number. It will start from mid 2017 onwards. It will definitely affect Malaysians.” Most of Intel’s plants are in the United States though. This restructuring may see Intel save up so US$1.4 billion next year.

Intel is projecting reduced revenues next year. The PC market is not recovering. (I have not heard of a single friend buying a desktop for many years.) It said that it will have to focus on making microchips for growth industries such as “data center, [Internet of Things], memory, and connectivity businesses, as well as growing client segments such as 2-in-1s, gaming, and home gateways.” Intel is also trying to enter the mobile devices market, challenging the dominance of Qualcomm Inc and Samsung Electronics Co. It announced, that the restructuring will “accelerate its evolution from a PC company to one that powers the cloud and billions of smart, connected computing devices.”

Reading between the lines would reveal that Intel is not suffering from huge losses. It is refocussing itself into growing sector instead of trying to struggle in a declining one. The staffs who lost their jobs have no choice but to flexibly move to the growth ones as stated by Intel. Jobs growth are still accelerating and not reducing and the growing sectors may be suffering from talent shortage while surplus talents in declining industry will find it hard to get a new job. The change really do have to begin with us. Read here: Online is future, thus more job cuts. Remember, during good times, invest so that when the bad times come, we have something to fall back on. Hopefully, the number of affected Malaysians would be as low as possible.

written on 20th Apr 2016

Next suggested article: Cutting Jobs because of strong US$ 

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