Govt fears 60,000 IT job losses after Intel shutdown


Posted at Jan 22 2009 04:13 PM | Updated as of Jan 23 2009 10:59 PM

(Erratum: In the first posting of this report, quoted former Intel Philippines spokeswoman Teresita Pacis that displaced Intel workers could be transferred to a new semiconductor company, Numonyx. The Office of the Press Secretary, in a January 22 release, quoted Philippine Economic Zone Authority chief Lilia de LIma and BOI Governor Francis Ferrer as having said that Numonyx would be absorbing majority of the laid-off Intel workers.  Mr. Doy Roque, public relations consultant of Intel Technology Philippines, informed us on January 23 that this was true last year but it is no longer the case. We have thus deleted the quote from Ms. Pacis and corrected the story. -- Editors)

The Department of Labor and Employment on Thursday said up to 60,000 workers in the electronics sector could lose their jobs this year as a result of the global economic crisis.

Labor Secretary Marianito Roque made the announcement following the news that some 1,800 electronics workers are losing their jobs with the impending closure of Intel Corp's  chip-manufacturing plant in General Trias, Cavite.

"We hope that the [Intel plant closure] would be the last. The semiconductor industry is already getting hit. We have seen this as early as three months ago. That's why we have moved in and set up our daily monitoring center. We said the electronics industry has about 480,000 workers, a small percentage of which could be affected, maybe about 60,000," Roque said in an ANC interview.

He said the closure of Intel's Cavite plant was not unexpected, noting that the electronics and garments sectors are the two industries most likely to be affected by the global economic crisis.

He said the labor department has already received notices of companies reducing work hours, compressing workweeks and laying off workers this January.

Intel Corp, the world's largest maker of microprocessors, announced Thursday that it is closing its manufacturing plant in General Trias, Cavite and offer severance packages to 1,800 employees.

Texas Instruments, another big US player in the sector, told the government last month it was laying off 400 workers from its semiconductor factory in the northern resort town of Baguio due to the global financial crisis.

Intel said the company will be closing two assembly test facilities in Penang, Malaysia, as well as its only remaining factory in Silicon Valley, cutting as many as 6,000 jobs.

"The company plans to close two existing assembly test facilities in Penang, Malaysia and one in Cavite, Philippines, and will halt production at Fab 20 an older 200mm wafer fabrication facility in Hillsboro, Oregon.  Additionally, wafer production operations will end at the D2 facility in Santa Clara, California," it said.

Intel said approximately 1,800 employees in the Philippine plant will be affected and will be offered a severance package and a range of transition services.

"We know this is a difficult time for our employees and their families and we will make available the best support systems to ease the transition. We are deeply grateful for the strong support that the Philippine government has extended to our operations in the country in the last 35 years. It has been key to our success," the company said.

The announcement comes a day after the world's largest maker of microprocessors used in personal computers slashed prices on a number of its chips and a week after it reported a decline in fourth-quarter revenue.

Not all cuts at the affected plants will lead to job losses and some workers will be offered positions at other facilities, it said, adding that the restructuring will take place between now and the end of 2009.