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News >> Technology >>
U.S. technology sector witnesses job cuts
By agencies
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Thursday, 14 April 2005, 19:30 IST
SILICON VALLEY:The technology sector in U.S. witnessed the largest job cuts in the first quarter of 2005, twice the layoffs during the same period last year, primarily as a result of large-scale corporate mergers, according to a new report.
The technology industry accounted for almost 21 percent of all layoffs; up from 11 percent a year ago, cutting nearly 60,000 jobs, ZDNet news said quoting Chicago-based job search firm Challenger, Gray and Christmas. While the telecommunications industry accounted for the bulk of the cuts with more than 35,000 layoffs in the first quarter, the computer industry laid off about 16,100 workers, the report said.
"The tech sector is in a state of volatility as companies try to identify and get a jump on the next big thing. They are shifting resources around at a breakneck pace trying to keep up with rapidly changing trends," Challenger, Gray and Christmas CEO John Challenger said. "
However, the biggest factor pushing tech job cuts to a five quarter high was a surge in corporate combinations in the telecom sector, which resulted in over 30,000 job cuts in February. In fact, 92 percent of the first-quarter telecom job cuts resulted from mergers," according to Challenger. The software industry is not immune either.
The industry will come under increasing pressure this year as consumers and corporations take a tech-spending breather, the report predicted.