Bloodiest tech industry layoffs of 2016 so far

Cisco, IBM, Intel, Microsoft, VMware among those cutting their workforces

The number of non-farm jobs added in the United States in recent months has inched up, and the unemployment rate has held steady at 5%, but that’s not to say the computer and networking industry hasn’t suffered its share of layoffs in 2016 to date.

Here’s a rundown of some of the more notable layoffs, workforce reductions, resizings or whatever companies want to call them.

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Cisco: The company revealed in August, as it was announcing year-end financial results, that it would jettisoning 5,500 employees in an effort to reinvest resources in the very hottest areas, including cloud computing, internet of things and security.

Or as Cisco put it: "Today, we announced a restructuring enabling us to optimize our cost base in lower growth areas of our portfolio and further invest in key priority areas such as security, IoT, collaboration, next generation data center and cloud. We expect to reinvest substantially all of the cost savings from these actions back into these businesses and will continue to aggressively invest to focus on our areas of future growth."

Microsoft: The company is axing another 1,850 staff from its smartphone hardware business, with most of those being  affected at the old Nokia business in Finland. Though 500 others will be let go globally.

Microsoft’s 2013 buyout of Nokia’s mobile phone business hasn’t panned out, with Microsoft’s market share stagnating as Android and Apple phones continue to gobble up market share. Microsoft has sold off its feature phone business and is sticking to enterprise-only technology, where it feels it can differentiate itself. 

Nokia: Speaking of Nokia... the telecom network equipment maker was said in April to be cutting thousands of jobs globally following its acquisition of Alcatel-Lucent. The cuts are part of a plan by the vendor to slash operational costs by $1B over the next couple of years

VMware: Coming off a “challenging” 2015, according to CEO Pat Gelsinger, the virtualization pioneer started the year by announcing 800 layoffs.

The company has acknowledged declines in its traditional virtual compute business, but has its sights set on playing a bigger role in the public and hybrid cloud markets, so the potential is there for VMware to offset its layoffs with new hires in those areas. Though rivals like Amazon Web Services and Microsoft won’t make it easy for VMware.

Intel: The chipmaker in April revealed that it is slashing 12,000 jobs worldwide as it refocuses on growth areas such as Internet of Things and servers in light of a dwindling PC market. That figure accounts for about 11% of total employees at Intel, which is also consolidating work locations.

One big problem for Intel has been its failure to really make it huge in smartphones, though word is that it might be in line for a bigger role in Apple’s iPhone 7 lineup.

IBM: Big Blue tends to announce hiring numbers (CEO Ginni Rommety says the company hired 70K people in 2015), but is vague when it lays people off or takes “resource actions.” The Wall Street Journal reported in May that IBM made early year layoffs that could total 14,000 in the wake of four years of declining revenue and in an effort to better position the company to take advantage of opportunities in cloud computing and analytics. And while few are happy when they lose their jobs, IBM has particularly angered some employees in recent layoff rounds by reducing severance to a month’s pay rather than as much as 6 months’ pay, as in the past.

Broadcom: The chipmaker, which counts Apple among its high profile customers, said in March it would be cutting 1,900 employees in the wake of its $37B merger with Avago and the resulting job redundancies.

BlackBerry: The beleaguered mobile company said in February that it had cut 200 more jobs at its Waterloo headquarters and in Sunrise, Fla.’s Al Sacco documented at the time how BlackBerry has become a serial job cutter in recent years, with three rounds last year alone, and that the cuts seemed to indicate a serious move away from the device business. He noted that the company back in early 2015 said it had a little more than 6,000 employees overall at the time.

BlackBerry has been diversifying into areas such as cybersecurity consulting and Internet of Things.

NetApp: The storage company in October revealed, via an SEC filing, that it plans to cut 6% of its staff as part of a restructuring. That adds up to about 640 people from a workforce of 10,700. NetApp has been challenged to compete with cloud-based offerings as it transitions into becoming more of a cloud and software company itself, while also pushing more into the flash storage market, such as through its SolidFire acquisition earlier this year.

Marvell Technology Group: The fabless chip company said in early November that it will axe 900 jobs (of 5,300) and sell off non-core assets to reduce costs by about $190 million a year.

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IDG News Service and Network World staff contributed to this compilation.

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