Intel to Slash 15-20% of Factory Workforce in Major Layoff Move

In a move that could be one of the largest workforce reductions in its manufacturing division, Intel is preparing to lay off between 15 to 20 per cent of its factory workforce, affecting over 10,000 workers. The decision is part of a broader cost-cutting effort as the chipmaker grapples with financial and operational headwinds.

Citing an email from Intel Manufacturing Vice-President Naga Chandrasekaran to employees, The Oregonian reported that the layoffs will primarily affect staff working under Intel's foundry division, including factory floor technicians and advanced research teams focused on next-generation microprocessor development. The company had approximately 109,000 employees globally at the end of 2022.

Intel confirmed the planned layoffs in a statement, stating: "Removing organisational complexity and empowering our engineers will enable us to better serve the needs of our customers and strengthen our execution." However, the company reiterated its commitment to treating employees with care and respect during the transition period.

The upcoming layoffs are expected to take effect in July, following an indication from Intel last April that reductions would begin the subsequent month. Unlike its previous round of layoffs, which included 3,000 job cuts in Oregon, this round will be determined based on investment priorities, skills assessments, and individual performance.

"It's a strategic decision," said Chandrasekaran. "These reductions will be based on a combination of portfolio changes, level and position elimination, skill assessment for remaining positions, and some hard decisions around our project investments."

The move is the latest example of the tech industry's efforts to reduce costs in response to financial pressures. As Intel navigates its challenges, it remains to be seen how this decision will impact the company's ability to meet customer needs and strengthen its position in the competitive chip market.