Saturday, January 31, 2009

Job cuts exceed 100,000 for the week

In a brutal week for the job market, an assortment of companies across various industries announced more than 100,000 job cuts.

The bulk of the job loss news occurred on Monday, when several major U.S. companies announced sweeping job cuts, pushing the day's total to more than 70,000.

Pfizer (PFE, Fortune 500), the leading drugmaker in terms of annual pharma sales, and Caterpillar (CAT, Fortune 500), a heavy equipment manufacturer based in Peoria, Ill., each said they would cut 20,000 jobs. These are the biggest reported eliminations among U.S.-based companies.

Caterpillar Chief Executive Jim Owens blamed the "rapidly deteriorating global economy" in his quarterly earnings report. Later, on Friday, Caterpillar added another 2,110 job cuts to its previously announced reductions, bringing its tally to more than 22,000.

Boeing (BA, Fortune 500) announced its massive layoffs on Wednesday. The Chicago-based airplane manufacturer said 10,000 workers, including 4,500 previously announced reductions, would lose their jobs. The company blamed this on dwindling demand for its aircraft.

Chico's (CHS), a retailer of women's clothing based in Fort Myers, Fla., said on Friday that it was cutting 180 positions. The retail industry has been hard-hit in recent months by a slow-down in consumer spending, partly because so many people have lost their jobs.

Also on Friday, the newspaper publisher A.H. Belo (AHC) said it was cutting 500 jobs. Chief Executive Robert Decherd, in a letter to colleagues, blamed the "rapid deterioration in the U.S. economy."
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Some Silicon Valley companies having second thoughts on outsourcing

Source: SiliconValley.com
The global recession — combined with the Satyam Computer Services scandal and the terror attacks in Mumbai — is changing the once rosy portrayal of endless good days for the growing outsourcing industry.

Silicon Valley companies now must grapple with the risks of sending critical functions offshore even while the economic downturn adds to the pressures to cut costs.

"We are in an environment where companies want to save money, but they also want to avoid risks. Offshoring is seen as an adventurous and risky thing to do," said Forrester Research Vice President Andrew Bartels.

While outsourcing is now a permanent fixture in many American business plans, the industry is facing its greatest challenge ever.

In India, software services companies face tough negotiations as clients seek to further trim costs. At the same time, they are subjected to greater scrutiny to ensure they are reliable and financially stable. In China, contract manufacturers are shutting factories, raising questions about their reliability as well as China's prospects as millions of migrant workers face unemployment.

The once high-flying outsourcing industry that boasted stunning growth has begun to slow dramatically. Infosys, India's second-largest outsourcing company, last month reported its first sequential quarterly drop in revenue and sliced its guidance for the year for the second time. Wipro, another outsourcing giant, warned investors that it expects revenue from its software-services business to drop this year.
Overall, global tech outsourcing is expected to drop 3 percent this year, according to a recent report by Forrester Research.

"We are living in tough times; the macroeconomic challenges are significant and impacting businesses across segments," Wipro Chairman Azim Premji said in a statement.

Satyam scandal

The scandal involving the Hyderabad-based outsourcing company Satyam centered on $1 billion worth of falsified financial statements. Satyam founder and chairman B. Ramalinga Raju has been arrested and stands accused of inflating the size of its work force by more than 10,000 and diverting wages from fake workers. Its Silicon Valley clients include Adobe Systems, Ariba, Brocade Communications Systems, Oracle, Network Appliance and Symantec.

The fall of the outsourcing giant, once considered a leader in corporate governance, shocked India's IT services industry.

"Satyam has scared the pants off of a lot of people," said Forrester Research analyst Stephanie Moore. "If you can't trust them, who do you trust?"

It has forced executives to look more closely at potential overseas partners.

"I get people stopping me in the hallways asking me, 'Should we be in India? Do we have a diversification plan?' " said Cory Eaves, chief technology officer with British software group Misys, which has 1,000 employees in India and also contracts with outsourcing companies, including Palo Alto-based Symphony Services. "Two months ago, I was not asked those questions."

Outsourcing executives say, only half jokingly, that they fear outsourcing firms will announce they will run out of cash in a month — and demand upfront payments, said Vamsee Tirukkala, co-founder of Zinnov, a Silicon Valley outsourcing consultant.

The Mumbai terror attacks in November added to the uncertainty felt by some company decision-makers, he said.

Still, such concerns are not reversing plans to outsource, particularly for startups trying to stretch their dollars. Pressures to reduce overhead in this bleak recession is intense.

It's particularly critical for small and mid-size companies to find cost relief, Tirukkala said. "They have to reduce their (cash) burn rates."

Companies have frozen new projects, said Gordon Brooks, chief executive of Symphony Services, a product development outsourcing company with extensive operations in India. But not those that need to update product offerings.

"They are afraid of losing their customer base if they don't get the new features out to market," he said. "It's a tricky time. It's not so much about growth. It's about doing well in a down economy and coming through on the other side."

The process of finding an outsourcing partner, though, has become more cumbersome. "There are a lot more questions people are asking, a lot more documentation they are reviewing, a lot more interviews, a lot more reference calls," Tirukkala said.

Overseas presence

He is also seeing a greater interest among companies to set up their own operations overseas, or at least have their own people located near outsourcing partners so they can react quickly to crises. "The biggest thing companies are saying is, 'I have to have some control over my operations,' " Tirukkala added.

It is unclear if U.S.-based outsourcing companies will pick up more business as a result of worries about the stability of foreign-based outsource firms.

"To a certain extent it helps us, being a U.S. company," Symphony Services CEO Brooks said. "But I think people understand Satyam was an anomaly, like Enron."

India, though increasingly faced with competition from lower-cost East Europe and other countries in Asia, remains a relatively inexpensive place to find great engineers, CTO Eaves said.

"They've got this huge skill base and a culture a bit like Silicon Valley," he said.

Contact John Boudreau at jboudreau@mercurynews.com or (408) 278-3496.

Worldwide sales of information technology products and services are expected to drop 3 percent to $1.66 trillion.
Global IT services and outsourcing also is expected to drop 3 percent.
The United States is expected to account for 34 percent of the global tech market in 2009 and 2010, down from 37 percent in 2005.

Morgan Stanley, Goldman mull further job cuts

Morgan Stanley (MS.N) and Goldman Sachs (GS.N) are considering further cuts in staff, the Wall Street Journal reported on Friday, citing people familiar with the matter.

The cuts could affect back-office and support functions including technology, infrastructure and human resources, the paper added.

Morgan Stanley is considering laying off up to 5 percent of its 47,000 employees, while Goldman Sachs is also contemplating further cuts in staff after letting go about 10 percent of its employees late last year, the paper said.

Morgan Stanley, which let go of about 7,000 employees last year, may decide on another round of staffing cuts in the next two weeks, the paper wrote.

NEC To Lay Off 20,000, Exit LCD Businesses

NEC said it would lay off as many as 20,000, employees during the coming year, the company said Friday.

The layoff notices came as part of a nine-month financial report for the period ended Dec. 31. For fiscal 2009, NEC now expects profits to decline from a profit of 15 billion yen ($165.9 million) to a loss of 290 billion yen ($3.02 billion), and sales are expected to decline by 9 percent to 4.2 trillion yen ($46.5 billion), with an operating loss of 30 billion yen ($331.9 million).
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Hitachi to cut up to 7,000 jobs

Hitachi is to cut up to 7,000 jobs, as it warned it expects to make an annual loss of 700bn yen ($7.8bn; £5.5bn) because of a big fall in global sales. Hitachi said the job cuts would be made globally across its car equipment and electronics divisions.

The Japanese electronics and engineering group had previously predicted it would make a net profit of 15bn yen in the year to 31 March 2009.
Hitachi is the latest Japanese firm to be hit by the global economic slowdown.

Kyocera cuts 250 jobs

Kyocera will cut 250 jobs from its San Diego mobile phone division as part of a restructuring linked to its acquisition of Sanyo's cell phone division last year.

The Japanese company will lay off the workers from its Kyocera Wireless division in Sorrento Mesa. The layoffs are across the handset division, spokesman John Chier said, but are most concentrated in engineering and manufacturing.

Toshiba to cut 4,500 jobs

Japan’s Toshiba Corp. said that it would cut 4,500 jobs and slash investment as the global economic slowdown pushes the company into the red this year.

The electronics and engineering giant said the financial crisis was badly hitting demand for its semiconductors and flat-screen televisions.

Friday, January 30, 2009

Thursday job cuts could exceed 13,000

The onslaught of job losses continued Thursday as employers announced a toll that could exceed 13,000.

Drugmaker AstraZeneca, photo products maker Eastman Kodak, aircraft company Cessna, truck maker Oshkosh, retailer Bon-Ton Stores and investment services provider Charles Schwab each said they would reduce payrolls.

Their workers were just the latest casualties in a savage week for the job market, with more than 15,000 cuts announced on Wednesday, 11,500 on Tuesday, and more than 71,000 on Monday.

Those jobs join the 2.6 million that the nation's economy lost last year. The companies typically blame the recession for their downsizing.

Schwab to chop up to 600 jobs, sees revenue drop

Charles Schwab Corp, the No. 1 U.S. online broker, warned on Thursday that revenues could drop as much as 20 percent this year and said it will cut between 500 and 600 jobs in the current quarter as it copes with low interest rates and a falling stock market.
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Infosys to Cut Bonuses, Compensation Packages

Infosys Technologies Ltd., India's second-biggest technology company by sales, warned Wednesday that it will cut employee bonuses and compensation packages in the months ahead as the global financial meltdown squeezes its customers and sales.
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Infosys puts over 5,000 employees under scanner

Infosys Technologies has placed around 5 per cent of its global workforce under the scanner. The move, which is being seen as an offshoot of the global financial meltdown, is expected to affect over 5,000 of the 100,000-plus employees on the company’s rolls.

It is learnt that Infosys, the country’s second-largest information technology services provider, has told its senior managers (project managers, senior and group project managers, delivery managers) to give the lowest performance rating (4 on a scale of 1-4) to the 'underperforming' 5 per cent as a part of the company's consolidated relative ranking (CRR).

Though rock-bottom rankings are not unknown in the company, this is the first time that Infosys has made it mandatory. CRR is decided based on the employee’s appraisals which is done twice a year. "The recommendations have already been submitted this month," a senior project manager working with Infosys told Business Standard on the condition of anonymity.

Infosys Vice-president and Group HR Head Nandita Gurjar said there was no change in the policy but "...the percentage of employees who are given CRR 4 keeps varying every year between 1 per cent and 5 per cent based on their performance."

The company has decided to implement a six-month mentoring programme for such employees after which it will decide their future based on the improvements they have made. As a part of this programme, each affected employee will be asked to work under the supervision of a mentor who is a senior executive.

During this period, the employee will not be given any important assignment, even though he will be allowed to work on the project where he is working at present. If the concerned employee is on bench, he will give all his time for the mentoring programme. During this time, the employee will get full salary as well as the regular allowances.

"While 50 per cent of such employees come back to the system, others get the message and quit voluntarily in most cases," Gurjar said.

It has also been learnt that about 40-50 pre-sale executives, most of who were located in the US, have been asked to quit during the last two months. Most of these people are from consulting background who are in a client-facing role. Gurjar confirmed the move but did not cite the number of people who have been asked to quit. "This is a part of our annual CRR initiative," she said.

TCS beats recession, wins new orders

Even as the fear of recession hits IT companies, Tata Consultancy Services (TCS) walk away with one order after another. In the last couple of months, TCS has bagged several orders from various international players. To begin, it landed the World Bank order.

This was followed by a contract from the Caterpillar. Soon, the Italian bike maker Ducati Motor Holding made a beeline for TCS.

Today, the Tata company has added yet another to its growing list of clients by getting an order from Phones 4U of the U.K.

Sources say that the international companies are even now looking at low cost countries for their off-shore option. This syndrome will continue even during the recession period. Today, customers do not want to spend more money on the near-shore market, which is customer location. This will be a boon to Indian IT companies. But what will happen if the rules are reversed by the U.S. President Barak Obama? One has to wait and watch. However, TCS seems to be looking at Europe and the U.K. markets in a big way. Will this be an alternative proposition for TCS?

Today, the company has bagged a $100 million agreement to provide a full range of managed IT services to 4UGroup, the holding company of Phones 4U, and other organisations in the U.K. telecommunication and financial services marketplaces.

Under the agreement, TCS will provide a full range of IT and business change services to 4U Group, including service management, application support, maintenance, management and development, data centre and desktop services, helpdesk, networks and communications, business support, and management of all third party contracts for the organisation’s retail operations. This will enable the group to improve IT service, increase capacity, boost skills, create a more flexible IT model and ultimately enhance the business to meet current and future demands.

According to sources, it will be a three-to five-year agreement. Since the retail innovation centre is located in Chennai, it is assumed that the delivery will be from the centres located in Chennai. Similarly, the company has also reportedly bagged another retail order from the U.S.

A. S. Lakshminarayanan, Vice-President and Country Manager, U.K. & Ireland, TCS, said the significant contract win underlined the important role that the company played in enabling the U.K. businesses to enhance their competitiveness and retain market share, especially in the current economic environment.

TCS signs $100 mn deal with Phones 4U

Tata Consultancy Services (TCS), signed a $100 million (around Rs 490 crore) deal with 4UGroup, the holding company behind Phones 4U and other organisations in the UK telecommunication and financial services market place.

Under the agreement, TCS will provide a full range of IT and business change services to 4U Group including: service management; application support, maintenance, management and development; data centre and desktop services; helpdesk; networks and communications; business support; and management of all third party contracts for the organisation’s retail operations.

TCS has around 4,800 people working in 65 locations in the UK.

IBM, Idea sign Rs 86 cr contract

International IT giant IBM has signed an agreement with the country's leading cellular telephone service provider Idea Cellular for providing end to end solutions to Idea.

Idea recently acquired Spice Communication for integration, transition and migration, Spice applications to Idea platform. The contract is worth Rs 86 crore and for eight years.

As part of the contract, IBM will manage Idea's IT operations and services in Punjab and Karnataka markets. Besides this IBM will also provide IT help desk services to Idea.

HCL bags Nokia's Desktop Management contract

Nokia has outsourced desktop management and help desk functions in 76 countries to Indian outsourcer HCL Technologies. HCL announced on Thursday that the handset maker has signed a five-year contract for an undisclosed sum. HCL manages over 650,000 desktops under its remote infrastructure management program.

The contract includes multilingual helpdesk services in 13 languages, global account management, workstation packaging, creation and maintenance, workstation security management, and on-site support services delivered by partners, HCL said.
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Wipro to hire 1,000 freshers

With job losses the order of the day in most firms, Bangalore-based Wipro today claims to be bucking the trend by making around 8,000 campus offers this fiscal year.

And in an email sent to all freshers seeking jobs in areas such as technical support and offshoring, the IT major is inviting applications for 15,000 seats.

In the mail, the company’s corporate vice-president for human resources, Pratik Kumar, says that nearly 14,000 offers were made last year, with the students expected to join by the end of this fiscal. He explained that there had been no delay in new recruits joining the company, and that those who received offers this year are expected to join the firm within the next fiscal year.

In its recent quarterly report, Wipro hinted about consolidation among existing staff and a lower rate of hiring. According to the mail, it has already dispatched learning kits containing CDs and content material on the organisation to those who are awaiting their joining date. "We hope that students would go through these and thereby save around two weeks on training when they join us. The normal training duration was 12 weeks,” said Kumar.

The net staff addition for Q3 ended 31 December 2008 was 587, compared with 1,877 in Q2. However, this includes the addition of around 1,600 people through the acquisition of Citi Technology Services.

Wipro has shown concern over the rise in the voluntary attrition rate in the third quarter of this year from 11 per cent in Q2 to 11.9 in Q3. According to Kumar, this number has improved from the 15.8 per cent attrition rate of Q3 of last fiscal, largely because offshore employees had a pay hike of seven to eight per cent in the second quarter of this year.

TCS leads race for Sony's $100-million outsourcing deal

India’s largest software exporter TCS is leading the race to win an outsourcing contract worth $60-100 million from Sony, the Japanese electronics giant struggling under huge losses and a high cost operating structure.

“As part of its attempts to reduce cost of managing IT operations, Sony is discussing a contract to manage its desktops and servers over 3-5 years,” a person familiar with the discussions told ET on condition of anonymity.

TCS is seen as a frontrunner because of its existing relationship with the electronics maker. “Sony also works with Satyam for SAP development and maintenance. However, current developments at the scandal-hit company are not going to help it win new projects,” said a senior executive at a top Indian tech firm requesting anonymity.
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TCS likely to shift 20 percent of U.S staff to India

Tackling the ongoing recession, India's largest IT exporter Tata Consultancy Services (TCS) is looking to shift 20 percent of its onsite workers in U.S., to India, realizing that offshoring is a better option in times of downturn. The company, which has been witnessing a dip in the clients' onsite requirements due to financial crunch, has realized that keeping a large workforce in U.S. would not be a good move, reported The Economic Times.

A person familiar with development said that a communication was sent last week to various middle and senior-level management personnel, informing them about the proposal to shift people back to India.

Denying that 20 percent of the staff in the U.S. was being moved back to India, a TCS spokesperson opined, "In the current environment, moving work to offshore locations is the focus for the company and its customers as this helps optimize costs and increase operational efficiencies for both TCS and its customers." He mentioned that less than five percent of the company's total U.S. staff has moved back to India up to December 31, 2008. TCS is currently employing close to 14,000 people in U.S.

As a result of the worsening recession in the U.S., most of the TCS' clients have completely stopped the enhancement work and hence require lesser number of people for delivering solutions onsite. They are also asking TCS to offshore their work.

A TCS employee working on a large banking project in the U.S. said fellow employees had been asked to return from the U.S. as the clients had made certain project management positions redundant. While the number of such people is spread across the hierarchy, most of the people asked to shift are employees with around four years of work experience.

According to the TCS spokesperson, the company has a business model based on delivering services from offshore locations using the Global Network Delivery Model to global customers. "We are constantly working towards increasing the amount of work done from offshore locations in India and elsewhere. Our effort to increase the amount of work done from locations in India has resulted in an offshore shift of 270 basis points in revenues in the last two quarters," spokesperson added.
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Info Edge launches 'firstnaukri.com' portal for freshers

Info Edge (India), promoter of leading job portal naukri.com, launched 'firstnaukri.com' for entry-level hiring. The company is also in the process of introducing more features and innovations for its other websites, including realty portal 99acres.com and matrimonial portal jeevansathi.com, to combat the slowdown in revenues.

Thursday, January 29, 2009

SAP to Cut More Than 3,000 Jobs Amid Global Slump

SAP AG, the world’s biggest maker of business-management software, will slash more than 3,000 jobs and freeze salaries this year as the economic slump hurts demand.

The workforce will be reduced to 48,500 this year, the Walldorf, Germany-based company said in a statement today. SAP employed 51,536 people at the end of 2008. Costs to eliminate jobs will weigh on margins this year and save as much as 350 million euros ($464 million) annually starting in 2010, SAP said.

Google, Microsoft hiring in thousands

Amid the gloom enveloping the jobs market worldwide, top 20 employers including Google and Microsoft, are looking to hire over 7,000 people, US magazine Fortune said. "As many big companies are announcing mass layoffs, these 20 top employers have at least 350 openings each right now," business magazine Fortune said.

The magazine had come out with a list of 100 Best Companies To Work For, which recognised firms that have gone out of their ways to please their employees despite the economic slowdown.

Fortune in a related report, has named 20 firms that are recruiting even in the gloomy environment. The list includes Internet major Google, which has 350 vacancies for engineering, marketing, product management and legal sales and Edward Jones with 1,040 job openings for financial advisors and branch office administrators.

Interestingly, Microsoft, which had announced on January 22 that it would be cutting up to 5,000 jobs in the next year and a half, is also looking to hire thousands of employees.

"But it (Microsoft) is still looking for software design engineers, financial analysts, human resources, administrative and marketing and sales talent, particularly in online ad sales," the magazine stated.

Other companies offering jobs include Wegmans Food Markets (2,000 jobs), Cisco Systems (500), Genetech (585), Whole Foods Market (800) and Ernst and Young(2,800). Global consultancy firm Ernst & Young is planning to hire around 2,400 experienced professionals and nearly 5,000 students from campus for opportunities in the US and Canada for fiscal year 2009. E&Y has openings in assurance, tax and several of the advisory practices.

Further, the companies looking to hire include KPMG, Booz Allen Hamilton, T-Mobile (2,163), PricewaterhouseCoopers (500)and Accenture.

Besides, in the Fortune list of best employers, storage and data management services provider NetApp topped the charts this year, moving ahead of Google, which had been at the top position for the past two years and stands at the fourth position now.

On Monday, a staggering over 80,000 job cuts were announced in a single day across the world, with construction machinery manufacturer Caterpillar, pharma major Pfizer, telecom firm Sprint Nextel Corp and home improvement retailer Home Depot together accounting for 61,000 lay-off announcements.

Job aspirants protest before Satyam office

Tired of the wait, a group of 300 aspirants who were given offer letters months ago by the company gathered before Satyam Infocity’s office in Hi-Tec City and demanded that they be allowed to join immediately.

Holding posters asking their prospective employer to break silence on the job issue, Satyam’s adhoc recruits filled in the lawn opposite the office, blocking traffic and movement of employees from the premises. They started gathering even before the official work hour.

The crowd which was less than 20 students at 8.30 am swelled to 150 by 9.30 am and by 1 pm to 300. Though not violent with slogans, the aspirants made their presence felt by their assertive silence.

Kodak May Announce Further Restructuring, Job Cuts

Eastman Kodak Co., fresh from a $3.4 billion, four-year restructuring that cut its workforce in half, may announce a second shake-up amid a continuing drop in sales.

“To see any sort of meaningful turnaround, they have to get costs way more in line with their peers,” Standard & Poor’s equity analyst Erik Kolb said in an interview. “That means cutting jobs, cutting anything wherever they can.”

Best Buy plans layoffs at headquarters

Electronics retailer Best Buy Co (BBY.N), which offered voluntary exit packages to corporate workers in December in a bid to cut costs, said on Tuesday it planned involuntary layoffs at its Minneapolis headquarters.

Employees were told on Tuesday about the layoffs and further details will be released on February 19, Best Buy spokeswoman Sue Busch Nehring said in an email.

Citrix Systems Cutting Staff 10%; Guidance Disappoints

Citrix Systems (CTXS) this afternoon said it plans to cut its staff by about 10% as part of a cost-cutting program. The company has about 4,600 employees. It posted a 4.2% decrease in fourth-quarter net income as product-license sales fell, and the company said it would reduce about 10% of its global work force as it consolidates its facilities.

Meanwhile, Citrix's first-quarter and full-year revenue outlook missed analysts' estimates, sending shares down 7.4% to $22.40 in after-hours trading.

The latest results were in contrast to larger rival VMware Inc. (VMW), which on Monday reported a 43% surge in its fourth-quarter net income but also issued a first-quarter view below analysts' estimates.

The provider of virtualization software, which improves computer efficiency by allowing multiple systems to operate on one computer, has cut costs recently but, until the job cuts on Wednesday, Citrix said it would continue to add employees and wouldn't delay expansion.
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Layoffs to Continue at IBM, Sources Say

According to eWeek:
IBM has laid off some 2,800 employees, with more to come, according to the Alliance@IBM organization. Big Blue has had job cuts in both its Software and its Sales and Distribution groups, with more to come in the company’s Systems and Technology Group, sources said.

Layoffs continue at IBM, particularly in the company's software and sales and distribution groups, where more than 2,800 people have been let go over the last week, with several more expected to be laid off over the next several days in other parts of the company, sources said.

According to an organization called Alliance@IBM, IBM has laid off at least 1,419 workers in its Software Group and another 1,449 in Sales and Distribution. Lee Conrad, national coordinator of Alliance@IBM, said the numbers come from documents his organization obtained from laid-off workers. The documents, basically separation agreements, indicate how many people have been affected by what IBM calls a "resource action."

Moreover, in an interview with eWEEK on Jan. 27, Conrad said his organization had heard from employees in IBM's Systems and Technology Group—which manufactures the company's hardware systems—that they had been laid off. Conrad said people from IBM's STG facilities in Burlington, Vt.; Rochester, Minn.; East Fishkill, N.Y.; and Research Triangle Park, N.C., contacted Alliance@IBM. Alliance@IBM, which is working to organize IBM employees into a union, expects at least "400 to 500" jobs to be eliminated at each of the four STG sites listed, he said.

"We expect further cuts over the next couple of days in other IBM divisions,” Conrad said. “We expect this to keep going right through the month. It's really unacceptable to us that IBM is not releasing the numbers or locations on these cuts. ... It's up to IBM to come clean on this."

Unlike the initial round of layoffs that began Jan. 21, IBM officials have acknowledged that there have indeed been layoffs, but would not get more specific on the extent of the layoffs or whether more would come and from where.

However, an executive at a software company that competes with IBM told eWEEK that he recently hired what he referred to as "one of the IBM layoff-ees." The executive, who asked not to be identified, added that although the economy is reeling, now is a time for software companies like his to find some seasoned talent with experience working on and selling big projects—like the folks at IBM.

According to a Wall Street Journal account of the layoffs, "It couldn't easily be determined what percentage of workers in the two groups was affected. But one large category—software engineers—suffered layoffs of 839 out of 9,784, or about 8.6 percent, according to a tally by one person who received a notice."

The WSJ account also noted that in the sales and distribution group, layoffs included 20 marketing managers and nine vice presidents. More than 150 vice presidents remain in the group, according to the documents.

UBS Slashes Its Bonus Pool for 2008 by More Than 80%

UBS AG, the European bank with the highest losses from the credit crisis, cut its bonus pool for 2008 by more than 80 percent.

Variable compensation for the bank’s employees excluding brokers in the U.S. is being reduced, Andreas Kern, a spokesman for Zurich-based UBS, said in an interview today. The pool will be less than 2 billion Swiss francs ($1.75 billion), based on the 9.5 billion francs UBS has said previously it paid out for 2007.

Starbucks to Cut 6,700 Jobs After Earnings Fall 69%

Starbucks Corp., the world’s largest chain of coffee shops, said it will cut 6,700 jobs and close 300 more stores after reporting first-quarter profit that fell more than analysts estimated.

The company plans to close 200 locations in the U.S. and 100 overseas, in addition to the 600 Starbucks said it would close last year. The workforce reduction will eliminate 6,000 café positions and 700 corporate jobs, the Seattle-based chain said today in a statement.

Allstate Posts $1.1 Billion Loss, Cuts 1,000 Jobs

Allstate Corp., the largest publicly traded U.S. home and auto insurer, will cut 1,000 jobs after the falling value of investments caused the company’s first annual loss as a public firm. Shares dropped 11 percent in extended trading.

Boeing Plans to Cut 10,000 Jobs as Demand Weakens

Boeing Co. said it plans to cut 10,000 jobs, or more than 6 percent of its workforce, after a strike and program delays led to a fourth-quarter loss and a global recession began to erode demand for aircraft.

The job reductions include 4,500 that were previously announced by Boeing, the second-largest maker of commercial planes and the No. 2 defense contractor. The new target was disclosed on a conference call after the Chicago-based company reported a net loss of $56 million after a year-earlier profit and said 2009 earnings will be lower than analysts predicted.
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Microsoft to Layoff Some H-1B Holders

Source: InternetNews
In wake of impending layoffs, Microsoft has released a preliminary response to a U.S. Senator who wants the software giant to cut non-citizens first.

Microsoft’s answer states that it will indeed layoff a significant number of H-1B temporary work visa holders but that their visiting worker status will not be the primary criterion when it comes to deciding who will stay and who will go.

Microsoft officials said they will respond to Senator Grassley’s request for a direct response. However, while the company’s initial response is polite, it doesn’t say it will meet Grassley’s request.

Memo sent to AOL employees by its CEO Randy Falco


Here’s the memo that Falco sent to AOL employees regarding the layoffs:


Dear AOL colleagues,

I’m writing to tell you about some important decisions we’ve made about AOL’s business and why we’ve made them.

The deepening economic recession has affected every corner of the economy, including our own. Online marketers have tightened their ad buying across the board, reducing their spend by hundreds of millions of dollars.

As a result, we will be reviewing our entire organization to further align resources and expenses against the real revenue opportunities in this difficult market. Part of this will involve consolidating groups to gain efficiencies that will unfortunately lead to head-count reductions. We anticipate this will result in a net reduction of our workforce of up to 10% over the next several quarters – and we will attempt to finalize all domestic actions by the end of March. Reducing our workforce is never easy, particularly in the current climate, but our goal in doing this is to provide our core businesses the resources they need to thrive. Please know that, as always, we’ll be doing everything we can to help and support those affected, including offering severance packages and other services.

To further keep employment costs down, we will also forgo merit pay increases in 2009. This is a painful decision, but one that many companies have prudently taken to help minimize the number of layoffs they have to make.

To provide some perspective on these decisions, right now we’re two years into a three-year turnaround plan. Since day one, our strategy has focused on building and growing mutually dependent publishing, advertising and social media businesses to take advantage of the shifting media landscape. We’ve worked shoulder-to-shoulder to make considerable progress during this time.

We acquired best-in-class companies across the digital advertising space (ADTECH, Third Screen Media, Lightningcast, buy.at, TACODA and Quigo) and integrated them with Advertising.com to build Platform-A, the largest, smartest display advertising platform in the world.

We grew our MediaGlow audience via an efficient content development model that in 2008 enabled us to launch more than 20 new sites that are generating significant page view (up 64% year over year in December), engagement (up 39% year over year) and unduplicated user (70+ million) numbers. This momentum will continue in 2009 with our goal of creating an additional 30+ editorially curated sites focused on consumer passion points.

We combined Bebo with our longtime community assets AIM and ICQ as well as newer acquisitions Goowy, Yedda and SocialThing, to build People Networks, gaining AOL a foothold in the critical social media space, with more announcements to come on the next phase of development in both the social media space and in the integration of social and publishing capabilities.

This progress continues to put AOL in a strong position to capitalize on our new business model when the recession ends.

In addition to focusing our investments, a successful turnaround plan also requires us to realign our cost structure against this three-pronged business model – making difficult decisions to cut costs in areas that aren’t critical to our growth. Splitting out the Access business improved the transparency of what’s working and what’s not, and allowed us to make better decisions about exiting businesses that weren’t performing while investing in growth areas. A successful turnaround plan also mandates we control costs, operate with healthy margins and position the company for sustainable growth. As you know, we’ve moved repeatedly to bring discretionary expenses in line to spare across-the-board job cuts.

But we’ve also had to make many hard decisions along the way. And this moment is no exception. We’re at a pivotal point in AOL’s transformation, and need to be even more strategically focused and operationally efficient as we weather the economic storm.

In addition to the head-count reductions and the 2009 merit pay decision, we are also making changes throughout the organization to improve efficiency and better align it to our three core businesses. This includes a review of our international operations and our global shared-services functions. In addition, we will continue throughout the year to carefully and thoroughly review all our products and services to make sure every one fully supports our strategy and has the potential for growth.

Finally, we are going to realize significant savings by continuing to consolidate our facilities – for example, moving from two buildings to one in Mountain View, from two floors to one in Los Angeles, and leasing unused space on our Dulles campus.

With these and other changes, we will take significant annual run-rate costs out of our business while, importantly, retaining the flexibility to invest in our growth strategy.

I know all this will raise questions, but I wanted to share as much as I could with you now. Senior management will provide more details as appropriate to their teams in the weeks ahead.

As difficult as things look right now, the economy eventually will turn around. Some companies will use this time prudently and make difficult decisions to come out of it in better shape – growing toward areas of opportunity, scaling back in others and maintaining a line on costs all around. Our only choice is to be one of these companies. With your continued hard work and dedication, we will position ourselves to emerge a stronger company ready to lead in a vibrant online market.

Randy

AOL axing 700 employees

AOL will cut its work force by 10 percent today, laying off approximately 700 employees, as a result of the struggling economy and a decrease in advertising revenue, we’ve confirmed with the company.

AOL has 7,000 employees worldwide. In a company wide memo (reproduced below), AOL CEO Randy Falco said the layoffs will be rolled out over the next few quarters and U.S. workforce reductions would be completed by March. He added that the company will eliminate merit pay increases in 2009.

While AOL may be considering a sale of Bebo, for now it is still the centerpiece of its People Networks business. Last July, TechCrunch reported that AOL reorganized its products group, including Xdrive, AOL Pictures, Bluestring and MyMobile, to shift focus and resources on other products including Bebo, MediaGlow and ad unit Platform A. The company also dismantled and reorganized its product management earlier this year; following the departure of Kevin Conroy.

The layoffs follow on the heels of Google’s write down of $726 million of its $1 billion investment in AOL, suggesting AOL’s total value is now $5.5 billion, compared to $20 billion at the time of Google’s 2005 investment in AOL.

Here’s the memo that Falco sent to AOL employees regarding the layoffs:

Dear AOL colleagues,

I’m writing to tell you about some important decisions we’ve made about AOL’s business and why we’ve made them.

The deepening economic recession has affected every corner of the economy, including our own. Online marketers have tightened their ad buying across the board, reducing their spend by hundreds of millions of dollars.

As a result, we will be reviewing our entire organization to further align resources and expenses against the real revenue opportunities in this difficult market. Part of this will involve consolidating groups to gain efficiencies that will unfortunately lead to head-count reductions. We anticipate this will result in a net reduction of our workforce of up to 10% over the next several quarters – and we will attempt to finalize all domestic actions by the end of March. Reducing our workforce is never easy, particularly in the current climate, but our goal in doing this is to provide our core businesses the resources they need to thrive. Please know that, as always, we’ll be doing everything we can to help and support those affected, including offering severance packages and other services.

To further keep employment costs down, we will also forgo merit pay increases in 2009. This is a painful decision, but one that many companies have prudently taken to help minimize the number of layoffs they have to make.

To provide some perspective on these decisions, right now we’re two years into a three-year turnaround plan. Since day one, our strategy has focused on building and growing mutually dependent publishing, advertising and social media businesses to take advantage of the shifting media landscape. We’ve worked shoulder-to-shoulder to make considerable progress during this time.

We acquired best-in-class companies across the digital advertising space (ADTECH, Third Screen Media, Lightningcast, buy.at, TACODA and Quigo) and integrated them with Advertising.com to build Platform-A, the largest, smartest display advertising platform in the world.

We grew our MediaGlow audience via an efficient content development model that in 2008 enabled us to launch more than 20 new sites that are generating significant page view (up 64% year over year in December), engagement (up 39% year over year) and unduplicated user (70+ million) numbers. This momentum will continue in 2009 with our goal of creating an additional 30+ editorially curated sites focused on consumer passion points.

We combined Bebo with our longtime community assets AIM and ICQ as well as newer acquisitions Goowy, Yedda and SocialThing, to build People Networks, gaining AOL a foothold in the critical social media space, with more announcements to come on the next phase of development in both the social media space and in the integration of social and publishing capabilities.

This progress continues to put AOL in a strong position to capitalize on our new business model when the recession ends.

In addition to focusing our investments, a successful turnaround plan also requires us to realign our cost structure against this three-pronged business model – making difficult decisions to cut costs in areas that aren’t critical to our growth. Splitting out the Access business improved the transparency of what’s working and what’s not, and allowed us to make better decisions about exiting businesses that weren’t performing while investing in growth areas. A successful turnaround plan also mandates we control costs, operate with healthy margins and position the company for sustainable growth. As you know, we’ve moved repeatedly to bring discretionary expenses in line to spare across-the-board job cuts.

But we’ve also had to make many hard decisions along the way. And this moment is no exception. We’re at a pivotal point in AOL’s transformation, and need to be even more strategically focused and operationally efficient as we weather the economic storm.

In addition to the head-count reductions and the 2009 merit pay decision, we are also making changes throughout the organization to improve efficiency and better align it to our three core businesses. This includes a review of our international operations and our global shared-services functions. In addition, we will continue throughout the year to carefully and thoroughly review all our products and services to make sure every one fully supports our strategy and has the potential for growth.

Finally, we are going to realize significant savings by continuing to consolidate our facilities – for example, moving from two buildings to one in Mountain View, from two floors to one in Los Angeles, and leasing unused space on our Dulles campus.

With these and other changes, we will take significant annual run-rate costs out of our business while, importantly, retaining the flexibility to invest in our growth strategy.

I know all this will raise questions, but I wanted to share as much as I could with you now. Senior management will provide more details as appropriate to their teams in the weeks ahead.

As difficult as things look right now, the economy eventually will turn around. Some companies will use this time prudently and make difficult decisions to come out of it in better shape – growing toward areas of opportunity, scaling back in others and maintaining a line on costs all around. Our only choice is to be one of these companies. With your continued hard work and dedication, we will position ourselves to emerge a stronger company ready to lead in a vibrant online market.

Randy

Unemployed Techies Hope To Help Themselves At LaidOffCamp in Silicon Valley

 Chris Hutchins, a former management and business strategy consultant who was laid off in early December, is looking to make the best of his predicament and a generally weak economy.

Realizing that he’s just one of many being laid off 224,000 employees have been ejected from the tech sector since August), Hutchins decided to launch LaidOffCamp San Francisco, a “bar camp” style event that he hopes will be a self-organized networking resource, start-up incubator, and group coping session for the recently unemployed in the Bay Area.

Hutchins, 24, said that yesterday’s wave of layoffs inspired him to try building a community for the unemployed and to “create resources for people who need to figure out what to do with their lives after being laid off.” Hutchins hopes to sponsor career fairs for participants but remains cautiously optimistic about finding employers who are actually hiring in the current economic climate.

Unsurprisingly, there are many online support groups that have been created for those who’ve been laid off, including Layoffs Café and iVillage’s Job Seekers’ Support Group. This also isn’t the first time we’ve seen the rise of resources for unemployed techies; the now defunct Recession Camp came to the aid of unemployed dotcommers following the downturn in 2001.

LaidOffCamp takes place at an unnamed venue in San Francisco on Tuesday, March 3 at 10 a.m. Topics of discussion will include how to live on a budget, how to develop a personal brand, and how to find a job in the current market. So far Hutchins has managed to attract only 26 confirmed guests on Facebook; he’s also generating activity for the event via Twitter , Yahoo’s Upcoming, and his wiki.
Courtesy: TechCrunch

Wednesday, January 28, 2009

More than 11,500 job cuts announced Tuesday

The bloodletting for the U.S. job market continues as companies across the economic spectrum announce a slew of work force reductions.

The job market continued to take a beating Tuesday, as six companies across several industries announced more than 11,500 job cuts Tuesday.

High-tech glass and ceramics maker Corning Inc. (GLW, Fortune 500) announced it will cut 3,500 jobs, or 13% of the company's workforce, by the end of 2009.

Meanwhile, oil field services company Baker Hughes (BHI, Fortune 500) announced it will cut 1,500 employees worldwide. That's about 4% of its work force, and 850 of the cuts will be from the company's North American work force.

And Navistar International Corp. (NAV) said it will close its Indianapolis engine plant and Indianapolis Casting Corporation factory at the end of July. About 700 employees will lose their jobs as a result, a Navistar spokesperson said.

Meanwhile, specialty chemicals and office products company Avery Dennison (AVY, Fortune 500) announced it will cut approximately 3,600 employees worldwide over the next two years "in response to challenging economic conditions." Details were unclear, as the plan is still in development. Navistar's stock closed up 4.56%, to $28.66.

Volvo Trucks North America announced permanent layoffs of 650 hourly employees in March and April at its plant in Dublin, Va. A spokesman said declining demand caused the 40% workforce reduction at the plant.

Forest product company Weyerhaeuser (WY, Fortune 500) announced it will close two mills in Washington and cut approximately 220 jobs "due to weak market conditions."

Target (TGT, Fortune 500), the second-largest U.S. discounter after Wal-Mart (WMT, Fortune 500), announced 1,500 job cuts. The Work force reduction affects 9% of employees at its headquarters, including the elimination of about 600 employees and 400 open positions, primarily in the Twin Cities area. The majority of those changes are effective today.

2009 List of 100 Best Companies to Work For

FORTUNE's 100 Best Companies to Work For 2009
Courtesy: Forbes.com
 Rank  Company
1  NetApp
2  Edward Jones
3  The Boston Consulting Group
4  Google, Inc.
5  Wegmans Food Markets
6  Cisco Systems, Inc
7  Genentech, Inc.
8  The Methodist Hospital System
9  The Goldman Sachs Group, Inc.
10  Nugget Market, Inc.
11  Adobe Systems Incorporated
12  Recreational Equipment, Inc. (REI)
13  Devon Energy Corporation
14  Robert W. Baird & Co.
15  W. L. Gore & Associates, Inc.
16  QUALCOMM Inc
17  Principal Financial Group
18  Shared Technologies Inc.
19  OhioHealth
20  SAS
21  Arnold & Porter LLP
22  Whole Foods Market
23  Zappos.com, Inc.
24  Starbucks Coffee Company
25  Johnson Financial Group
26  Aflac Incorporated
27  QuikTrip
28  PCL Construction Enterprises, Inc.
29  Quicken Loans
30  Bingham McCutchen
31  CARMAX
32  The Container Store
33  JM Family Enterprises, Inc.
34  Umpqua Bank
35  Kimley-Horn and Associates, Inc.
36  Alston & Bird LLP
37  TDIndustries
38  Microsoft Corporation
39  Paychex, Inc.
40  EOG Resources, Inc.
41  Camden Property Trust
42  Plante & Moran, PLLC
43  Rackspace
44  NuStar Energy L.P.
45  King's Daughters Medical Center
46  American Fidelity Assurance Company
47  DreamWorks Animation SKG, Inc.
48  Mattel, Inc.
49  Intuit Inc.
50  Burns & McDonnell
51  Ernst & Young LLP
52  Booz Allen Hamilton
53  Stew Leonard's
54  Erickson Retirement Communities
55  salesforce.com
56  KPMG LLP
57  Novo Nordisk Inc.
58  PricewaterhouseCoopers
59  SCRIPPS HEALTH
60  Scottrade, Inc.
61  Deloitte & Touche USA LLP
62  Griffin Hospital
63  Mayo Clinic
64  Milliken & Company
65  Texas Instruments
66  The MITRE Corporation
67  Children's Healthcare of Atlanta
68  Southern Ohio Medical Center
69  National Instruments
70  Stanley, Inc.
71  The Men's Wearhouse, Inc.
72  Nordstrom
73  Chesapeake Energy Corporation
74  Alcon Laboratories, Inc.
75  Atlantic Health System
76  Lehigh Valley Hospital and Health Network
77  Northwest Community Hospital
78  Marriott International, Inc.
79  Baptist Health South Florida
80  Bright Horizons Family Solutions
81  S. C. Johnson & Son, Inc.
82  Perkins Coie LLP
83  eBay Inc.
84  Juniper Networks
85  Arkansas Childrens' Hospital
86  CH2M HILL
87  Orrick, Herrington & Sutcliffe LLP
88  Publix Super Markets, Inc.
89  Herman Miller, Inc.
90  FedEx Corporation
91  Gilbane Inc.
92  Four Seasons Hotels and Resorts
93  Valero
94  Build-A-Bear Workshop
95  Kimpton Hotel and Restaurants
96  T-Mobile USA, Inc.
97  Accenture
98  Vanderbilt University
99  General Mills
100  SRA International

Best TECH companies to work in 2009

Source: Indiatimes Infotech
Is Google the best tech company to work for, or is it Cisco, or Microsoft? The answer is none! In fact, none of the tech giants come close to NetApp, the storage and data management services provider which has been ranked as the best tech company by Fortune in its annual list of ‘100 Best Companies to Work For’.  Click here for the list of top companies by IndiaTimes.

Outsourcing faces new era of scrutiny

Source: The Economic Times

TRUSTWORTHINESS
Adding to the sector's troubles is the massive corporate fraud uncovered recently at Satyam Computer Services Ltd, India's fourth largest software services provider. The scandal has Satyam customers scrambling to find alternative providers.

Other offshore services providers report stepped-up scrutiny from clients of their own corporate governance and financial viability. It has also revived questions about the trustworthiness of Indian accounts and the adequacy of corporate controls.

That's a big black eye for an industry that sells risk management and corporate governance services as a major client offering. It may raise the risk premium investors require for holding these stocks.

PRICE PRESSURES
Rising competition isn't the only threat to offshore outsourcers' margins.

Many of the more profitable, longer-term contracts worth tens or hundreds of millions of dollars are being put on hold as companies scramble to reassess their business strategies.

Customers want more control over projects and are demanding fixed-price deals that are more likely than not to limit margin growth. Infosys, Tata and others say they are doing their best to make up for price cuts by driving greater sales volumes.

The trend is disguised by the long-term nature of many existing software services contracts. Recent reports suggest many customers are scaling back or cancelling long-term "mega-deals" until they can get a handle on the impact of economic decline on their own businesses.

The industry is subsisting on short-term, quick-fix contracts aimed at cutting operational costs as fast as possible. These price-sensitive deals are what software services firms had been trying to move away from in favour of higher-value projects to create new businesses for customers, not just manage existing software or customer services.

There is a big cultural change underway in global corporations that may be less friendly to outsourcing. Fallout from the financial crisis is likely to mean far greater pressure on chief executives to run a tighter ship. There's likely to be less merger activity, less headlong expansion and less resulting need to consolidate organizations using external services.

Chief executives are sure to be more closely scrutinized for the operational choices they make, instead of farming out responsibility to lower level technical managers in order to focus on deal-making.

Inevitably there is a lack of control involved in contracting business operations out around the globe. This more constrained environment could be less favourable for outsourcing than downturns of the past.

News Corp’s digital division to lays off 100 employees

Layoffs happened this time from News Corp.'s digital division, Fox Interactive Media (FIM)! Nearly 100 jobs are being slashed by FIM, across its business units like MySpace, Photobucket, Rotten Tomatoes, Scout Media, and corporate.

The announced cuts comprise nearly 5 percent of the domestic US workforce of FIM, and almost 3 percent of its worldwide workforce of 2,900.

Motorola Cuts 77 Jobs from the Windows Mobile Division

According to the latest news on the web, Motorola has announced that it would lay off 77 employees from its Plantation facility in Florida by the end of the first quarter of the year. Moreover, it seems that “The company said it will no longer conduct new Windows mobile development at the facility,” reports the South Florida Business Journal.

It is still unclear whether the layoffs are part of the already announced 4,000 job cuts the mobile phone maker announced that it would operate this year. As already reported, the company stated that around 3,000 of the positions it planned to reduce were from its mobile device unit.

'Target' announces corporate office layoffs

Target Corporation announced layoffs this morning at its corporate headquarters in Minneapolis, adding to the tens of thousands of job losses that have already been announced this week. The discount retailer would not disclose how many employees would lose their jobs, saying they first had to notify its employees.

IBM: 2 rounds of layoffs in 6 days

IBM has had two rounds of layoffs within the past two weeks, a company spokesman said. “We did this last week on the 21st and today,” said IBM spokesman Doug Shelton, referring to the layoffs. Shelton would not comment on how many IBM employees were laid off, what departments they worked in and where they were located.

Published reports say IBM cut 2,800 jobs in sales and software.

Tuesday, January 27, 2009

American Express lays off more Indian employees

Global credit card and payment services major American Express has asked some more of its employees in India to leave this month, as part of its global restructuring announced late last year.

"Only 1-2 per cent of our present workforce in India is impacted," an Amex spokesperson told media, without giving specific numbers.

According to industry sources, Amex has a workforce of over 6,000 people in India.

The company spokesperson separately said in an emailed statement, "The restructuring is part of the overall worldwide re-engineering efforts we announced in late 2008.

In late October 2008, Amex announced that it would cut 7,000 jobs globally, representing about 10 per cent of its worldwide workforce, as part of a plan to save 1.8 billion dollars of costs in 2009.

This was followed by about a hundred job cuts in India.

Wipro bags UK-based Morrisons' IT contract

UK-based food retailer Morrisons, with 375 stores and annual turnover of £13bn has tied up with India's third largest IT company Wipro Technologies for development of its IT applications and systems.

Wipro will support Morrisons to achieve the core objective of delivering effective planning, management and delivery of large scale systems and process change based on an Oracle ERP platform. The Bangalore based IT company will deliver an operating model that supports the retailer's strategic and commercial objectives.The details for the size of the deal were not disclosed.
,

Miserable Monday: 70,000 job losses announced worldwide

Caterpillar leads a grim day by cutting 20,000, but a merged Pfizer and Wyeth will equal that. Others sharply reducing employment include Sprint Nextel, Home Depot, and GM.

Several large international companies have announced mass redundancies as a result of the worldwide financial crisis. A total of 70,000 job losses were announced on Monday.

The biggest number of jobs to go is at US bulldozer and digger manufacturer Catepillar where 20,000 people will lose their jobs. US telecom giant Sprint Nexel is planning to sack 8,000 people. Japan's large car manufacturers say they are going to scrap 25,000 jobs in the first quarter of this year.

Dutch companies also joined the wave of job cuts. Seven thousand jobs across the globe are due to go at ING Bank. Electrical goods manufacturer Philips is making 6,000 employees redundant. And at the Anglo-Dutch steel works Corus, 3,500 jobs will be cut. Stagnation in the economy is given as the main reason for the reorganisations.

Not thousands, we recruit in lakhs: LIC Chairman

The size does matter when it comes to employment generation at a time when companies are wielding axe on jobs, as insurance giant LIC today said it would employ 11 lakh more agents by March 2011 to double its field workforce.
"They (private insurers) are talking about 30,000. We are talking about 11-12 lakh and that is the difference. (In) three years, we want to double the number of agents," LIC Chairman T S Vijayan told PTI on comparison with private sector competitors in terms of hiring plans.

"We don't talk about thousands. We talk about lakhs. Last year, we ended with 11 lakh plus agents and we would like to increase it by a minimum 25 per cent by March, 2009. This is a target we have taken ourselves and I think we will be able to do it," he said.

During the current year, the country's largest insurer recruited about two lakh insurance agents across the length and breadth of the country.

This excludes hiring plans for development officers, he clarified, saying that during the current financial year alone, LIC has recruited 4,500 officers and the next year the number could go up by up to 5,000.

Currently, LIC has about 24,000 development officers across the country.

To compete with LIC, private life insurers are also recruiting agents to expand their businesses and reach, but the numbers are much less than the largest player.

For example, Reliance Life is in the process of adding 90,000 agents and 2,500 managers, while Metlife and Max New York Life would increase advisors' strength by 30,000 agents by the end of the current fiscal.
, , , ,

US Senator asks Microsoft to layoff H1-B employees

Microsoft H-1B workers may be first to lose jobs??

With plans to lay off 5,000 employees in the face of the global credit crisis, there have been calls to Microsoft asking workers on the H1B visa to be the first to go. In a letter to Microsoft Chief Executive Steve Ballmer, Republican Senator, Chuck Grassley personally requested H1B employees be the first up for redundancy.

"During a layoff, companies should not be retaining H-1B or other work visa programme employees over qualified American workers," Grassley said.

A majority of the 60,000 H-1B visas issued every year go to India skilled professionals, with Microsoft being one of the major recipients.

"We care about all our employees, so we are providing services and support to try to help every affected worker, whether they are US workers or foreign nationals working in this country on a visa," said a Microsoft spokesperson.

The company has been a major supporter of the US visa service which allows overseas employees in specialty occupations to work in the US for up to six years.
,

IBM quietly lays off North American staff

IBM has been quietly laying off workers in its North American offices since Wednesday, according to numerous reports online. IBM has not made any formal announcements yet, but IBM Director of Corporate Media Relations Doug Shelton confirmed to CNET News on Saturday that some employees were notified on January 21 that their jobs were being cut. The company would not say how many people had been laid off or in what facilities or departments those cuts were made.

Speculation about those details are rampant online. So far, more than 2,800 employees have been laid off from IBM's software, and sales and distribution divisions, according to Alliance@IBM, a Communications Workers of America affiliate attempting to organize IBM workers into a union. Comments on the Alliance@IBM Web site indicate that cuts have already been made in Toronto. And a spokesman for IBM Canada confirmed on Friday that IBM is in the process of laying off employees, some of whom were in the Canadian offices, according to ComputerWorld Canada.

Layoffs in USA: More than 40,000 layoffs announced on Monday

Philips to cut 6,000 jobs
Royal Philips Electronics plans to cut 6,000 jobs. Those cuts could include layoffs at a Latham[,NY] operation. “I know that cuts across all sectors and all geographies,” said Ian Race, a spokesman for Holland-based Philips. Philips has 500 employees in Latham.

Sprint to lay off 8,000 by April
Sprint Nextel Corp. today said that it will lay off about 8,000 workers by April within “all levels” of the company. The carrier also said it will suspend the 401(k) matches for workers for 2009 and extend a freeze on annual salary increases started in 2008 through 2009. A tuition-reimbursement program was also suspended.

ING Group to layoff 7,000 employees
With a second successive quarterly loss on the cards for ING Group NV, the company plans to layoff 7,000 employees, and appoint Jan Hommen - the present chairman of the ING board, and the former chief financial officer of Philips Electronics - as its new CEO in the place of the current chief executive Michel Tilmant. ING - the biggest Dutch financial-services company - is likely to post a net loss of about 1 billion euros for the full 2008 year; the loss resulting partly from ending its Argentina pension operations, and from the cost incurred by disposing off an insurance business in Taiwan.

Home Depot cutting 7,000 jobs
“Home Depot, the No. 1 home improvement retailer, announced Monday that it is shutting down its high-end EXPO business and shrinking its support staff, with both moves resulting in a reduction of 7,000 jobs.”

Pfizer to lay off tens of thousands
Pfizer announced Monday that it has signed a deal to acquire the smaller drugmaker Wyeth for $68 billion, and tens of thousands of job cuts will follow. Pfizer spokesman Ray Kerins said that two waves of job cuts would occur in 2009. In the first, Pfizer said it would cut 10% of its 81,900 staff - about 8,000 jobs. Kerins said that Pfizer will launch the second round of job cuts once its merger with Wyeth and its 50,000 workers is completed in the third or fourth quarter. At that time, Kerins said Pfizer will cut 15% of the combined company’s 120,000 or so workers - about 18,000 more job cuts.

Caterpillar to lay off 20,000
Caterpillar, seeing sales for its bulldozers and other heavy equipment sinking in a worldwide economic mire, said Monday that its business was “whipsawed” during the fourth quarter and that it would eliminate 20,000 jobs in the face of a “very tough” 2009. Caterpillar announced the staff reductions as part of its fourth quarter earnings report, released Monday morning. The company said that while its revenue and profit for full-year 2008 were strong, its business ran head first into the worldwide recession in the fourth quarter.
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Microsoft closes Flight Simulator unit news


Deeply disappointing the gaming community, Microsoft Corp has shut down ACES Studios, its wholly-owned subsidiary that produced Flight Simulator, Microsoft's longest-running and perhaps most popular game. This follows on the heels of the Redmond, Michigan-based company's earlier announcement that it is axing 5000 jobs.

Saturday, January 24, 2009

Google loses best workplace crown to NetApp

California technology firm NetApp has taken Google's crown as best company to work for in 2009, according to an annual Top 100 list published by Fortune Magazine. Google held the Fortune title of "Best Company to Work For" for two years, knocking biotech drug firm Genentech from the top spot in 2007.

Google sank to fourth place in rankings published in the February 2 issue of Fortune. St. Louis-based brokerage Edward Jones was second followed by Boston Consulting, a management consulting firm. Silicon Valley insiders speculated the sag in Google's status could be related to cost-cutting measures such as the cancellation of an annual ski outing for the northern California Internet giant's snow-loving employees.

The magazine noted that Google attracts 770,000 job applicants yearly, despite having done away with "frills" such as afternoon tea. Fortune praised NetApp for a "legendary egalitarian culture" and down-to-earth management ethos.

Rather than business plans, workers at the company specializing in data management and computer storage draft "future histories" describing their visions for coming years, according to Fortune.

Worker benefits reportedly include paid days for volunteer work, cash to supplement adopting children and medical coverage for family members with autism.

Veteran network-equipment company Cisco in the heart of Silicon Valley ranked sixth on the list, while its neighbor Adobe Systems was listed in 11th place.

The rankings are done by San Francisco's Great Place to Work Institute, which reportedly surveyed more than 81,000 employees from 353 companies.

Larsen & Toubro(L&T) has tripled its stake in Satyam Computer Services to 12%

Larsen & Toubro (L&T) has moved a step closer to acquiring scam-hit Satyam Computer. The engineering major on Friday bought 3.9 crore Satyam shares at a price of Rs 34.52 per share in a bulk deal estimated at around Rs 135 crore on the NSE. With this, the total shareholding of L&T in Satyam has increased from 4.48 per cent to 12.04 per cent.

California jobless rate hits 9.3%

California's unemployment rate jumped to 9.3% in December from 8.4% in November and 5.9% a year earlier as job cuts swept across most industries, with recession tightening its grip on the most populous U.S. state, officials said Friday.

California's December jobless rate marked a 14-year high for the state and was significantly higher than the month's national average of 7.2%, underscoring a surge in job losses over the last three months of 2008, said Patti Roberts, a spokeswoman for the state's Employment Development Department.

Compass Bank to cut 10 percent of staff

Compass Bank says it is cutting 1,200 workers, or about 10 percent of its staff, as part of an overall reorganization.

The company said Friday the job cuts will spread across all of its business units in six states. Compass said the workers who will lose their jobs will be notified within the next few days and will receive severance.

The cuts include management and non-managment positions. The bank is the U.S. unit of Spain-based Banco Bilbao Vizcaya Argentaria SA, which bought Compass for $9.6 billion in 2007.

Microsoft Layoffs: Big Cuts At Flight Simulator Studio

Microsoft has confirmed the closure of ACES Studio. Former ACES developer Phil Taylor claims in a blog post that six employees were retained to fulfill contractual duties, and Flight Simulator may continue to exist as a franchise in some other form.

Redmond, Washington-based ACES Studio, the Microsoft-owned internal group behind the venerable Microsoft Flight Simulator series, has been heavily affected by Microsoft’s ongoing job cuts.

A large portion of the dev house’s staff has been let go - with multiple reports indicating that the entire Flight Simulator team has been axed.

Yahoo suspends employee pay raises

Yahoo has frozen employee salaries.
The company told employees Wednesday that it would stop all annual pay raises in 2009. Yahoo is trying to turn its fortunes around while it faces internal struggles, as well as the external challenges presented by the current economy. Despite the freeze on annual raises at Yahoo, employees who are promoted to higher positions within the company could still obtain increases.

Yahoo isn't alone in turning to salary freezes as a means to tighten spending. Several other companies, including Microsoft, are halting pay raises to reduce payroll costs. Others have come up with alternative means for reducing their payroll. For instance, media company Gannett has mandated its employees take one week of unpaid vacation. Google announced a new stock option plan for its employees this week. The methods won't necessarily halt layoffs.

Yahoo laid off about 1,500 people in December, and several blogs reported rumors that there may be more to come. However, those rumors are based on an anonymous inside source.

Microsoft Layoffs: Steve Ballmer's email to staff

From: Steve Ballmer
Sent: Thursday, January 22, 2009 6:07 AM
To: Microsoft - All Employees (QBDG)

Subject: Realigning Resources and Reducing Costs

In response to the realities of a deteriorating economy, we're taking important steps to realign Microsoft's business. I want to tell you about what we're doing and why.

Today we announced second quarter revenue of $16.6 billion. This number is an increase of just 2 per cent compared with the second quarter of last year and it is approximately $900 million below our earlier expectations.

The fact that we are growing at all during the worst recession in two generations reflects our strong business fundamentals and is a testament to your hard work. Our products provide great value to our customers. Our financial position is solid. We have made long-term investments that continue to pay off.

But it is also clear that we are not immune to the effects of the economy. Consumers and businesses have reined in spending, which is affecting PC shipments and IT expenditures.

Our response to this environment must combine a commitment to long-term investments in innovation with prompt action to reduce our costs.

During the second quarter we started down the right path. As the economy deteriorated, we acted quickly. As a result, we reduced operating expenses during the quarter by $600 million. I appreciate the agility you have shown in enabling us to achieve this result.

Now we need to do more. We must make adjustments to ensure that our investments are tightly aligned with current and future revenue opportunities. The current environment requires that we continue to increase our efficiency.

As part of the process of adjustments, we will eliminate up to 5,000 positions in R&D, marketing, sales, finance, LCA, HR, and IT over the next 18 months, of which 1,400 will occur today. We'll also open new positions to support key investment areas during this same period of time. Our net headcount in these functions will decline by 2,000 to 3,000 over the next 18 months. In addition, our workforce in support, consulting, operations, billing, manufacturing, and data center operations will continue to change in direct response to customer needs.

Our leaders all have specific goals to manage costs prudently and thoughtfully. They have the flexibility to adjust the size of their teams so they are appropriately matched to revenue potential, to add headcount where they need to increase investments in order to ensure future success, and to drive efficiency.

To increase efficiency, we're taking a series of aggressive steps. We'll cut travel expenditures 20 percent and make significant reductions in spending on vendors and contingent staff. We've scaled back Puget Sound campus expansion and reduced marketing budgets. We'll also reduce costs by eliminating merit increases for FY10 that would have taken effect in September of this calendar year.

Each of these steps will be difficult. Our priority remains doing right by our customers and our employees. For employees who are directly affected, I know this will be a difficult time for you and I want to assure you that we will provide help and support during this transition. We have established an outplacement center in the Puget Sound region and we'll provide outplacement services in many other locations to help you find new jobs. Some of you may find jobs internally. For those who don't, we will also offer severance pay and other benefits.

The decision to eliminate jobs is a very difficult one. Our people are the foundation of everything we have achieved and we place the highest value on the commitment and hard work that you have dedicated to building this company. But we believe these job eliminations are crucial to our ability to adjust the company's cost structure so that we have the resources to drive future profitable growth. I encourage you to attend tomorrow's Town Hall at 9am PST in Café 34 or watch the webcast.

While this is the most challenging economic climate we have ever faced, I want to reiterate my confidence in the strength of our competitive position and soundness of our approach.

With these changes in place, I feel confident that we will have the resources we need to continue to invest in long-term computing trends that offer the greatest opportunity to deliver value to our customers and shareholders, benefit to society, and growth for Microsoft.

With our approach to investing for the long term and managing our expenses, I know Microsoft will emerge an even stronger industry leader than it is today.

Thank you for your continued commitment and hard work.

Steve

Friday, January 23, 2009

Story on "Open source's role in the recent software layoffs"

InfoWorld's Story on "Open source's role in the recent software layoffs"

By now, news of layoffs at IBM and Microsoft have been reported far and wide. Some may take this opportunity to predict victory for open source. However, I'm hard-pressed to reach this conclusion. Indeed, as an IBM Software employee, I have a biased view. But hear me out.

IBM reported a 10.5 percent year-to-year increase in 2008 Software revenue to $22.1 billion. Microsoft's Server & Tools business grew 15 percent year-to-year in Q2-FY09 to $3.74 billion. I call out the Microsoft Server & Tools business division because the majority of Microsoft's products that compete against open source (Windows Server, SQL Server, and Visual Studio) reside in the Server & Tools division. Yes, you could argue that Linux on the desktop was the driver behind the 8 percent year-to-year quarterly decline in Microsoft's Client division. But it's more likely, as InfoWorld's Tom Sullivan points out, that Vista's issues drove the decline in Microsoft's Client division business.

Nonetheless, when you look at the growth rates from IBM and Microsoft's divisions that could compete against open source, 10.5 and 15 percent are very healthy growth rates. This is doubly true when the size of the revenue (tens of billions) is taken into account. So it's difficult for me to see open source as the driver behind the layoffs.

I do, however, fear that these layoffs are a precursor to similar actions we'll see from open source companies. It's been argued that open source will do better during the belt tightening due to lower initial costs. However, what's lower than $0? I've had three discussions with friends whose companies have made the choice to go with open source solutions for projects that they've typically used commercial products. These companies have decided to save costs by asking their internal developers to shoulder the cost of supporting the open source products. So while commercial vendors were kept out of these three deals, so too were open source vendors. Clearly, three isolated examples don't make a trend. But I fear that we'll see a lot more of this in 2009.

What are you seeing out there?

p.s.: I should state: "The postings on this site are my own and don't necessarily represent IBM's positions, strategies, or opinions."

Game maker Sega confirms US layoffs

Today, Sega of America confirmed to GameSpot that it is the latest third-party publisher to cut its payroll. The news comes just weeks after a particularly brutal year that saw a worldwide economic downturn hit such third-party publishers as Electronic Arts, Midway, THQ, and PlayStation 3 maker Sony.

Microsoft won't cut jobs in India

Source: IndiaTimes
Starting with 1,400 job cuts, software giant Microsoft will slash 5,000 jobs over the next 18 months.

"Microsoft will eliminate up to 5,000 jobs in R&D, HR, marketing, sales, finance, legal, and IT over the next 18 months, including 1,400 jobs today," the company said in a statement.

The layoff, however, would not be impacting the Indian operations. "It's not going to impact us. No job cuts in India," a Microsoft India spokesperson said in New Delhi.

In light of further deterioration of global economic conditions, extra measures to manage costs are being taken, including the reduction of head-count-related expenses, vendors and contingent staff, facilities, capital expenditures and marketing, the company, which posted a 11 per cent decline in profit for the second quarter, added in the statement.

Microsoft's net profit declined 11 per cent to $4.17 bn for the quarter ended December 31, 2008. It had a net profit of $4.71 bn in the year-ago period.

The company has posted revenues to the tune of $16.63 bn for the second quarter. The entity's revenues stood at $16.37 bn in the corresponding period a year ago.

Sony forecasts first annual net loss in 14 years

Sony said Thursday it plans to cut another 1,000 temporary workers in Japan and close one of two domestic TV plants.

Sony also will offer early retirement packages to its regular, full-time workers in an effort to cut 30 percent of its personnel costs in its TV business by March 2010. It refused to give a head count but said they are part of the 8,000 job cuts announced earlier, according to Yahoo Finance

Comerica bank plans to lay off 5% of workforce.

Dallas-based Comerica Inc. earned a small profit in the last three months of 2008, set aside more money for credit losses and announced plans to cut 5 percent of its workforce, according to an earnings report released Thursday.

The bank, which moved from Detroit to Dallas in 2007 and still has a large employment base in Michigan, said it has already cut about 5 percent of its labor force since late 2007. The additional 5 percent cut announced Thursday will be largely completed by the end of March.

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