Dell Technologies Inc, one of the world’s leading suppliers of PCs, has announced that it is set to lay off 5% of its global workforce which is about 6,650 jobs.
Dell declared that the layoff is due to the reduction of the customers’ demands and the PC makers in the economy and reduced corporate spending because of inflation and exorbitant interest rates.
In a memo sent to the employees, co-Chief Operating Officer Jeff Clarke wrote; What we know is market conditions continue to erode with an uncertain future,”
Dell’s previous attempts to tackle the economic downturn
It is imperative for any organization that wishes to lessen the impact of a declining economy to take precautions. However, the PC maker had taken some precautions in managing a challenging economic environment before the resolution to terminate employee contracts.
In early June 2022, Dell decided to pause external hiring except for a few strategic areas to control costs. Also, the PC maker economized its travel and reduced its outside services spending. At the time, the CFO, Tom Sweet, explained it was to help the company navigate the challenges of the global economic environment and uncertainty ahead.
However, despite these measures by the US-based company, Jeff Clarke established in a memo that these were not enough to tackle the economic challenges encountered.
Clarke explains that the company sees a need to lay staff off because of the slower demands for personal computers. The Texas-based company announced similar layoffs in 2020 after the pandemic hit, which affected the economy and business widening.
“We continuously evaluate operations to ensure the right structure is in place to provide the best value and support to partners and customers, “a spokesperson disclosed in an interview with the BBC.
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Brief dive into what Dell does and its achievements
Dell, a US technology-based company, was founded by American Michael Dell in 1984 in Austin, Texas and headquartered in Round Rock, Texas.
As of January 2021, Dell was acknowledged as the largest shipper of PC monitors and the third-largest PC vendor by unit sales worldwide. In April 2021, the company announced the decision to spin off its 81% ownership stake in VMware, a cloud-computing and virtualization software firm that joined Dell Technologies in 2015 as part of its $67 billion acquisition of software giant EMC.
Today, Dell is the world’s #3 supplier of PCs (behind #1 HP and #2 Lenovo). In January 2022, it had about 133,000 employees, of which about one-third were based in the United States. As of today, there are over 165,000 Dell employees all over the globe.
Nonetheless, as layoffs in the US hit more than a two-year high in January, Dell has been included among the US technology firms that cut jobs to formulate possible solutions for recession.
Read More; Glovo to lay off 6.5% of its global workforce
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