As part of a corporate restructuring and cost-cutting initiative, Hewlett-Packard has announced it will cut 9,000 jobs in the United States with long term plans to reduce 27,000 jobs exiting fiscal year 2014. The total layoffs would result in the company downsizing to approximately 300,000, a number HP has aimed to stay around after acquiring the service company Electronic Data Systems (EDS).
In addition to the 9,000 U.S. job cuts, HP also plans to layoff 8,000 of its employees in the European Union. By the end of the 27,000 layoffs, HP would have reduced 8 percent of its original staff though it is currently unspecified where or which departments employees will be cut from.
Although some layoffs began back in October of last year when the company had 350,000 jobs, HP announced additional job cuts this past May when it said the combination of layoffs and retirements would save the company more than $3 billion through 2014. According to a statement by HP, the majority of the savings will be invested in marketing and sales tools, as well as security, analytics and cloud.
“These initiatives build upon our recent organizational realignment, and will further streamline our operations, improve our processes, and remove complexity from our business,” said Meg Whitman, HP president and chief executive officer. “While some of these actions are difficult because they involve the loss of jobs, they are necessary to improve execution and to fund the long term health of the company. We are setting HP on a path to extend our global leadership and deliver the greatest value to customers and shareholders.”
In May, HP also announced a net loss of 31 percent, or $1.5 billion, in the second quarter compared to last year’s numbers. Experts say HP’s direction with investments in cloud computing and information management is logical, but it will still have a tough competition unless it can stand out from the myriads of other companies heading the same way.
At the moment, HP has not commented on the active start of its layoff initiatives.