Fujitsu to Slash Workforce by 16,000, Toshiba to eliminate 17,000 jobs
On August 20, Fujitsu Limited announced a
corporate restructuring plan that will see
the company slash its workforce by 11,400
overseas and 5,000 in Japan, shedding a total
of 16,400 employees. This figure comes to
slightly less than 10% of the group's total
of 180,000 employees. Fujitsu will also restructure
its semiconductor plants and consolidate
its production centers as a pillar of this
plan.
Fujitsu, which is expected this year to post
the highest consolidated loss in the company's
history, seeks to cut fixed labor costs such
as personnel expenses by 100 billion yen
through this restructuring plan and steer
itself away from its reliance on hardware
in its three main business sectors of semiconductors,
information equipment, and communications
equipment and more toward software and services.
Fujitsu believes that by 2003 the company
will be able to post an operating profit
of 400 billion yen in its consolidated balance
statement.
Fujitsu's plan concentrates on reducing the
group's overseas workforce. Of the 5,000
domestic employees scheduled to be cut, only
2,500 will be full-time employees. Fujitsu
claims that most of these cuts will come
in the form of employees reaching retirement
age or from implementation of voluntary retirement
plans, thus maximizing domestic employment
despite the cuts.
And on August 27, Toshiba Corp. also announced
to slash 17,000 jobs in Japan. It will reduce
its domestic workforce by 12% by fiscal 2003.
Toshiba, meanwhile, felt that conventional
style of restructuring (that maintains domestic
jobs intact) would no longer work. The company
aimed at reforming their corporate structure
to make it more agile, nimble, and lightweight,
enabling it to respond to market and other
changes in a flexible manner.
These restructuring plans follow on
the heels
of workforce reductions by electronics
giants
Matsushita Electric Industrial and
NEC Corp.
(see the JIL Labor Flash Vol. 2).