Dell to lay off about 6,650 employees worldwide as PC sales slump
07 February 2023
Dell Technologies Inc on Monday announced plans to lay off about 5 per cent, or about 6,650 of its employees worldwide amidst a slump in the personal computer market and signs of a potential recession.
Demand for new personal computers has collapsed after a two-year boom during the pandemic when people working from home were forced to buy new personal computers, including monitors and laptops to keyboards.
The market for PCs and tablets is set for another year of decline in 2023 with a fall of 2.6 per cent, according to research firm IDC, after rapid growth
The layoffs also add to the thousands of cuts in the tech industry whose outlook has been shaken by a drop in spending by consumers and businesses due to rising interest rates, according to a report from Bloomberg News.
According to a memo to staffers from Jeff Clarke, co-chief operating officer, the market circumstances for the company continue to degrade with an uncertain future.
Clarke in the message also said prior efforts at cost-cutting, such as a halt on employment and travel restrictions, proved insufficient. The company views the cutoffs as a potential to increase efficiency with the departmental restructuring and employment reduction.
Dell had about 133,000 employees as of Jan. 28, 2022, of which, about one-third were based in the United States.
Rival HP Inc has also said it will cut up to 6,000 jobs.
"It was only a matter of time before the wave of tech layoffs reached Dell's shores, given how sensitive the company is to both consumer and corporate confidence," said Susannah Streeter, markets analyst, Hargreaves Lansdown.
Microsoft Corp, Amazon.com Inc, and Goldman Sachs Group Inc are just a few of the companies that have lately cut thousands of positions to help consumers and businesses weather a decline in demand brought on by high inflation and rising interest rates.
According to a survey released on Thursday, layoffs in the US reached a more than two-year high in January as technology companies shed staff at the second-fastest rate ever as they prepare for a potential downturn.