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Jan 19, 2009

AMD to lay of 1100 more

There has not been a lot of good news regarding the economy lately. Now comes news that Advanced Micro Devices is planning to lay off another 1,100 employees.

The company will also be cutting pay for the employees that it retains. This is the third layoff announcement at AMD in the last 12 months. This latest round brings the total number of layoffs at AMD over the last year to 3,300. Of this latest 1,100 cuts, AMD says 900 will come from layoffs and the other 200 will come from normal attrition and the loss of employees from a business unit that has been sold, according to a report by AP.

AMD has a total of 15,000 workers today, but 3,000 of those are in manufacturing operations, which are being spun off into another entity. If only the 12,000 non-manufacturing, core AMD workers are considered, today’s cut represents 9 percent of the AMD workforce, a large percentage. Over the last year, the percentage laid off is approaching 20 percent.

As noted above, the remaining 11,000 or so employees of AMD will see mandatory wage cuts almost immediately. The two top employees, CEO Dirk Meyer and executive chairman Hector Ruiz will lose 20 percent of their paychecks. Other top management personnel will have their pay cut by 15 percent. All other AMD employees will see pay cuts of 10 percent (salaried) and 5 percent (hourly).

AMD has has a rough couple of revenue years. The company is restructuring in a major way, including spinning off its manufacturing facilities and selling almost 20 percent of the company to a government investment organ of the Persian Gulf state of Abu Dhabi. Along the way, they have replaced their CEO and cut 3,300 jobs at all levels. They have struggled with delays in new product introduction, the costly purchase of ATI Technologies, and shortfalls in research and development as compared to major rival Intel.

One would hate to see AMD fail in this reorganization. For purposes of healthy competition, we need at least two healthy developers and manufacturers of personal computer CPUs. It is often the races for enhancements and breakthroughs among competing companies that gives consumers the biggest gains. We certainly don’t want to see stagnation in the CPU marketplace.

Source : Blorge
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