HP to Layoff 27,000; Largest Layoffs in Company History
May 23, 2012 4:47 PM
comment(s) - last by
(Source: Jason Mick/DailyTech LLC)
Chinese unit is expected to be spared; remaining workers are pressured to "work harder"
Soon, approximately 27,000 workers at Hewlett-Packard Comp. (HPQ) will be
out of the job
-- almost 8 percent of the company's total staff of 324,000.
HP surprised with
better than expected earnings
for fiscal Q2 2012, announcing revenue of $30.7B USD, more than the analyst consensus of $29.9B USD. Profit checked in at $2.3B USD ($1.05 USD/share), more than the $1.02 USD/share analysts predicted. Optimism in the stronger-than-expected performance was tempered by estimates for the next quarter, which were
lower than analysts expected
, amid a slump on sales of printers, data-center equipment, and services.
The HP layoff program will be gradually implemented as part of a restructuring that wraps up by October 2014. The layoffs will be the largest in the company's 73-year history. News of the painful layoffs
leaked last week
HP has not revealed a precise timeline for when the job cuts will occur, within the 2012-2014 restructuring windows. However, sources indicate that most of the cuts will likely come in the U.S. and Europe, while the company's Chinese unit -- a major growth target -- will largely be spared.
Meg Whitman is thinning the herd at HP, hoping to get the same amount of work out of less engineers. [Image Source: towleroad]
Remaining employees will have to pick up the slack for their departed co-workers under former eBay, Inc. (
) CEO and new HP CEO
Meg Whitman's vision for the company
. Still a bit of a silver-lining to this cloudy news is that Ms. Whitman did indicate that some of the $3.5B USD saved would be reinvested in working towards restoring
to its former glory.
Long a bastion of electronics industry research, HP Labs has continued to do novel work, such as
inventing the memristor
-- a long theorized circuit element, which could lead to new cheaper,
more power-efficient kinds of storage
. However, the cutbacks have forced the star institution to operate on a shoestring budget, raising questions of whether HP will be able to continue to attract top talent. The situation is so bad at HP Labs, according to
The New York Times
, that researchers are forced to use pirated software for their day-to-day work.
HP's deep cuts are bad news for its employees -- and U.S. engineers in general who will face greater competition in the jobs market. However, they're hardly out of place in a post-recession U.S., where many companies have learned that they can boost profits by squeezing the same amount of work out of fewer employees. That philosphy has helped to stifle job recovery, even as GDP growth has slowly come back to life post-recession.
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RE: Buy American?
5/24/2012 6:47:54 PM
Jason I definitely agree with you on the flat tax idea. Every single person should be taxed the exact same percentage not exceptions. If you set the rate at 10%, then if you make $1 this year you owe $0.10 in taxes, if you make $1,000,000 then you owe $100,000. I also think it should be applied to welfare payments and other types of assistance. It sounds counter intuitive but really if the ones receiving the payments never see any tax burden then they are not likely to have a rational voice in tax policy. You see this with the Occupy Wall Street crowd yelling for rich people to pay up while many of them pay little or now taxes and yet many also receive a large cut of what the rich are paying. The financial burden should fall upon every citizen since every citizen is a part of this country and all receive some type of benefit from being a citizen.
Business taxes should be the same, set a flat rate and give no exceptions, all companies pay the same and receive no breaks or incentives. If you set it at a proper rate then they will all be able to handle the tax burden and business will thrive and compete on a level field. The state and local governments should be held to the same rules. That way locations that can afford to give a tax break because they collect more taxes from the people living there or more established business can not use that as an incentive, they must compete on a level field with other locations.
RE: Buy American?
5/29/2012 10:42:58 AM
A flat tax is a nonstarter mainly because it would get rid of all those juicy tax breaks the rich get and they won't give up.
Second of all, flat taxes are highly regressive, punishing consumers and that is economic suicide. Its been long known that supply-side tax cuts never work and consumer-side always works.
Every flat tax plan known increases taxation for the bottom 99% Its a dirty little secret, which is why the pizza candidate had to rewrite his 999 plan because people actually looked at the numbers and said....hey wait a minute. Romney's tax plan will punish the consumer too.
"The Space Elevator will be built about 50 years after everyone stops laughing" -- Sir Arthur C. Clarke
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