BUSINESS
Microsoft Ireland to cut jobs
13-01-2003
by
One of the jewels of the Irish high-tech landscape, Microsoft Ireland, is expected to trim as many as 60 jobs this week, ElectricNews.Net has learned.
Microsoft Ireland is understood to be finalising a plan that will see between 50 and 60 jobs lost in the Republic, with an announcement set to be made before the end of the week. The cuts would amount to just over 3 percent of the software giant's Irish workforce.
Microsoft Ireland said it was unwilling to comment on the possibility of job cuts, nor would the company confirm that an announcement was imminent.
However, according to informed sources, Microsoft is cutting back on the number of localisation workers it employs in Ireland. It is thought that some departing workers will have the opportunity to apply for work in other areas of the company, while other staff members may be given the chance to relocate to Microsoft's headquarters in Redmond, Washington. Workers that are not "redeployed" will be offered a redundancy package, a source said.
The cuts are rooted in what is thought to be a push, from Redmond, for greater efficiency and productivity at Microsoft Ireland, with fewer employees. In September 2002, the company cut a number of Irish-based, .Net project-related jobs, claiming that moving the jobs to the US would increase efficiency. Days after those cuts were made, however, Microsoft CEO Steve Ballmer admitted that Microsoft jobs will "come and go" in Ireland, but overall the company was committed to its base here.
With about 1,700 employees, Microsoft operates three businesses in Ireland -- a European operations centre, a European product development centre, and its Ireland sales, marketing & services group. After its headquarters, the Irish facility is the company's second largest in the world, alongside an operation in Japan.
Microsoft spends around EUR350 million each year in the Irish economy, and the software behemoth accounts for about 6 percent of national exports.
The cuts in September, and the job losses set to be announced this week, come at a time when Microsoft is outperforming the rest of the technology sector and has announced plans to up its global headcount. In July 2002, the company said that it planned to increase its R&D spending by 20 percent over the next year and would bring on an additional 5,000 workers as part of the move. Globally, Microsoft employs more than 50,000.
In its fiscal first quarter results, released in October, the maker of Windows said that profits amounted to USD2.73 billion, or USD0.50 a share, compared to net earnings of USD1.28 billion, or USD0.23 a share, for the same period a year ago. The staggeringly strong numbers, in the face of a weak IT market, included sales for the fiscal first quarter of USD7.75 billion, up 27 percent from USD6.1 billion in sales a year ago.
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