In effort to slash costs, HP downsizes its global workforce

Palo Alto, CA, United States (4E) – Hewlett-Packard, the world’s biggest personal computer manufacturer, will slash 29,000 jobs as it aims to cut costs. Initially, HP planned to cut 27,000 jobs but weak PC sales and the struggling global economy has forced the company to let go even more employees.

The job cuts will save HP more than $3.5 billion in research and development. The job cuts will take place in a span of two years.

The company’s plan of slashing jobs is part of its restructuring strategy to keep the second biggest personal computer manufacturer, Lenovo, off of its heels.

It is not only the slow sales of computers that have affected HP; it’s the weak demand for business equipment such as data centers and printers.

Bloomberg News reports that, “many cuts will take place in the ailing enterprise services group, which manages data centers and provides information-technology consulting.”

HP has already cut more than 3,800 jobs as of July of this year. The 29,000 jobs represent an estimated 8 percent of the company’s global workforce.

Analysts already expect Lenovo to top HP in total PC shipments later this year.

“It’s more than they said last time, but who’s to say it’s not going to get higher if things get worse? They’ve got a lot of wood to chop, and this is a long-term turnaround story,” Topeka Capital Markets analyst Brian White said in a telephone interview with Bloomberg News.

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