The Gadget Jobocalypse? Tech Stalwarts are Still Downsizing

Our string of job-related stories may be very timely indeed, particularly advice on what to do if you're laid-off—Motorola, Google, Microsoft and Seagate are all about to do some staff downsizing, or take a serious look at their options.

Woe-mired cellphone maker Motorola announced yesterday that it will immediately ditch around 6% of its global workforce—mainly from its handset division. That amounts to perhaps 3,000 to 4,000 fewer people developing new phones for Motorola, which may be why the company is tying itself to producing no more than 12 new cellphones per year (apparently all running Android). Those leaked devices we saw earlier may be the whole lineup for 2009.

Hard-drive manufacturer Seagate is also ditching some 6% of its global staff—in this case that's around 3,000 people of which about 800 are in the US. Simultaneously the company is cutting executives pay, in some cases by up to 25%, which it expects to create a saving of $80 million annually. The job cuts are going to save some $130 million each year—though cost $90 million in compensation payouts at first.

Google is also cutting jobs, albeit only a few: 100 recruiters and some satellite engineering sights are going. While the numbers concerned are small, and Google is only tangentially in the hardware business—unlike Seagate and Moto—when a massive, profitable entity like Google takes a step like this it's worth paying attention.

The Wall Street Journal is also reporting that Microsoft is finalizing plans to lay off significant numbers of staff. Initial rumors were around 15,000, but have been toned down a lot from that high number—which would've represented over 16% of its global workforce of around 91,000.

And just last month Sony reported that it would cut 8,000 staff and consolidate its manufacturing sites in a move designed to save over a billion dollars in annual costs.

What have these companies done wrong? In many cases nothing much: These companies are pushing out new, innovative products that capture the public's imagination all the time (even if Motorola's recent batch of products have been lackluster.) It's simply a reflection of consumer spending shrinkage as the economic crisis pinches harder, with "luxury" gadgets being an easy saving for people.

For example, the IDC reported that PC sales in the last quarter of 2008 were lower than 2007's figures—the first year-on-year drop in six years. Independent research reports suggested that consumer electronics spending (specifically IT and IT-related services) would dip 3% in 2009. And a separate report showed shrinking spending on cellphones, with Nokia predicted to be suffering least with just a 10% sales fall.

Are these moves indications of a coming technology jobocalypse? Hopefully not. They're classic internal maneuvers as attempts to cut costs and save the company's bottom line from dipping more than it already has. It may even be a good thing for the average consumer: as well as cutting costs these firms will need to produce innovative new gear to tempt you into purchasing.

[via Reuters, Engadget. Image: AP]

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