US employers announce a combined 20,000 job cuts

ST LOUIS: A round of more than 15,000 layoffs announced by AT&T Inc, DuPont and Viacom Inc suggests a yearlong wave of US job cuts is
accelerating, just as the government is expected to report a higher unemployment rate for November on Friday.

Swiss bank Credit Suisse Group has announced 5,300 job cuts, although it's unclear how many will be in the United States.

The latest layoffs coincided with a government report showing the proportion of workers continuing to receive jobless benefits has matched a level last reached in September 1992. The deepening recession is pressuring companies to slash costs, and payroll is typically the quickest and most efficient way to do it.

Yesterday's announced job cuts spanned an array of economic sectors, hitting telecom workers, bankers, salespeople and chemical manufacturers. The breadth of the layoffs suggests the pain of the recession will be felt broadly and well into 2009.

Dallas-based AT&T plans to cut 12,000 jobs, about 4 percent of its work force. The nation's biggest telecommunications company said the job cuts will begin this month and continue throughout 2009.

Wilmington, Delaware-based chemical company Dupont will cut 2,500 jobs and cut back hours for remaining workers. It also plans to eliminate 4,000 contractors this month, with more contractor cuts in 2009.

New York-based media conglomerate Viacom will cut about 850 jobs, or 7 percent of its work force.

Credit Suisse's 5,300 planned job cuts worldwide represents about 11 percent of its work force.

Courtesy: Times of India

HP freezes salaries to cut costs

SAN FRANCISCO: Hewlett-Packard Co, the world’s largest personal-computer maker, is freezing salaries as part of Chief Executive Officer Mark Hurd’s efforts to contain costs, people familiar with the plan said.

Employees have been notified by e-mail that they won’t receive a salary increase in fiscal 2009, which began in November, according to two people who asked not to be identified because the message was confidential. The only exceptions will be in countries where pay freezes are illegal, the two people said.

Hurd has cut jobs, closed offices and merged data centers to lift profit, even as he expands through acquisitions. Hewlett- Packard also is limiting travel, curtailing hiring and eliminating “favorite science projects” to save on research costs in 2009, Chief Financial Officer Cathie Lesjak said last month on a conference call.

Hewlett-Packard, which has 320,000 employees, declined to confirm the salary freeze. “In this difficult macroeconomic environment, we believe it is prudent and responsible to reduce costs where possible,” said spokeswoman Emma McCulloch. “H-P has a longstanding and disciplined approach to managing costs in order to invest in the company’s growth.”

Hewlett-Packard, based in Palo Alto, California, fell $1.43 to $33.39 at 4 pm in New York Stock Exchange trading. The shares have dropped 34 per cent this year.

Hurd, who became CEO in 2005, received $25.3 million in total compensation in fiscal 2007.

Tighter budgets
Worldwide technology spending growth will slow to 2.6 per cent next year, less than half the rate initially predicted, research firm IDC said last month. Growth in the US will decelerate to 0.9 per cent, the Framingham, Massachusetts-based company estimated.

The company also said it will only hire workers for “revenue-generating positions,” reduce spending on contractors and limit travel to customer-related activities, according to the e-mail, a copy of which was obtained by Bloomberg News.

“These are difficult actions, but necessary in the current environment,” said the message, which was distributed by Hewlett-Packard’s division chiefs.

Hewlett-Packard’s PC sales, which account for about a third of revenue, rose 10 percent to $11.2 billion last quarter, beating some estimates. Demand for notebooks offset declining printer sales in a shrinking economy. The company is the world’s top printer maker and also sells software, server computers, storage devices and services.

Profit forecast
Last month, Hurd forecast a rise in profit to as much as $4.03 a share this fiscal year, more than the $3.89 anticipated by analysts in a Bloomberg survey. Investors took that as a sign the company is prepared to squeeze more profit out of sales as customers reduce spending.

“It will be a challenging environment and we’re planning on such,” Hurd, 51, said on a Nov 23 conference call with reporters. “We can only control the things we can control, which is our cost structure and the competitiveness of our products.”

This week, Hewlett-Packard raised $2 billion in debt to help fund its $13.2 billion purchase of Electronic Data Systems Corp. It acquired that company in August to expand its services business.

Courtesy: Times of India

Sr IT execs fired for faking degree

NEW DELHI: Broadcom Corp, the maker of chips for phones and consumer electronics, fired Senior Vice President Vahid Manian after questions surfaced about the validity of academic degrees listed in his company biography.

A search has begun for his replacement, the company said today in a regulatory filing. Manian didn’t earn degrees from the University of California at Irvine that are cited on the company’s web site, according to the school’s registrar.

Manian also serves on the board of STEC Inc with Microsemi Corp Chief Executive Officer James Peterson, who faces separate questions about his credentials. Peterson, who lists degrees from Brigham Young University in government filings, never received them from that school, said Carri Jenkins, a university spokeswoman in Provo, Utah. Peterson did take classes there from 1978 to 1980, Jenkins said.

Manian’s firing is the first action taken by one of the three businesses tied to the executives, which are all technology companies in California’s Orange County. His departure follows the retirement of MGM Mirage Chairman and CEO Terry Lanni, who stepped down last month after similar questions surfaced about his MBA from the University of Southern California. MGM said the claims didn’t influence his decision.

Broadcom’s site said Manian had bachelor’s and master’s of business administration degrees from the University of California at Irvine. The executive, who oversaw global manufacturing at Broadcom, attended the school between September 1979 and August 1983 but wasn’t awarded any degrees, said Mark Fonseca, who is responsible for privacy issues in the registrar’s office.

No MBA record
Fonseca said Manian attended classes for four years but didn’t graduate. He said he isn’t allowed by law to disclose why Manian didn’t receive a degree. The school had no record of Manian studying for an MBA, Fonseca said.

Manian joined Irvine-based Broadcom in 1996 as director of operations after a stint at Silicon Systems Inc. Microsemi’s Peterson said he had vetted and hired Manian when the two worked at that company.

Peterson said today that he “categorically denies” misrepresenting degrees from Brigham Young University.

“I am working directly with the university to clarify this situation,” Peterson said in a statement. “I have every reason to expect that Brigham Young will investigate this allegation shortly and officially confirm my degrees.”

Peterson said a background check on him may have mistakenly used the name James J. Patterson.

‘Very careful’
Brigham Young’s Jenkins said in an interview after the statement that she checked degree records again and couldn’t find any record of a degree for Peterson. She said she had been checking the right name.

“We are always very careful when we release this kind of information,” she said.

Microsemi fell $2.88, or 16 percent, to $15.47 at 4 p.m. New York time in Nasdaq Stock Market trading. Broadcom rose $1.27 to $15.51, while STEC gained 2 cents to $4.91.

Microsemi’s Peterson serves with Manian on STEC’s audit, compensation, and nominating and corporate-governance committees.

A US government security clearance application form provided by Peterson lists his position at Microsemi and states that he has bachelor’s and MBA degrees from Brigham Young. A regulatory filing for STEC also lists the degrees.

Associate’s degree
Peterson was awarded an associate’s degree in arts, sciences and general education from Ricks College in Rexburg, Idaho, in December 1978, said Kyle Martin, registrar of Brigham Young University Idaho. In 2001, Ricks College became Brigham Young University Idaho, which is separate from the school in Utah, he said. As a former junior college, it couldn’t have conferred a higher degree, he said.

The discrepancies were uncovered by Barry Minkow, co-founder of the Fraud Discovery Institute, which looks into the backgrounds of executives.
Minkow served more than seven years in prison, from 1988 to 1995, after being convicted of fraud while running a company called ZZZZ Best Co.

Minkow almost always holds a position in securities his organization reports on, according to a disclaimer on his Web site. He said he has put options on STEC and Microsemi shares, and doesn’t own a position in Broadcom.

Peterson said in an interview that he earned credits during his military service that counted toward the degree from Brigham Young. He didn’t provide a university transcript after earlier saying he would.

Cliff Silver, a spokesman for Microsemi, referred inquiries to the CEO. The Irvine-based company makes chips for military and aerospace customers.

Manouch Moshayedi, STEC’S chief executive officer, defended Manian and Peterson yesterday in a telephone interview, saying they were “extremely competent.” STEC, based in Santa Ana, California, makes memory chips.

Minkow also raised the questions about MGM’s Lanni, who listed an MBA in his company biography. Lanni responded that he did receive an honorary MBA from the University of Southern California.

Courtesy: Times of India

Infy to freeze hiring, no job cuts

NEW DELHI: Infosys Technologies Ltd will freeze recruitment after meeting this fiscal year's target of hiring 25,000 staff, a telling sign the glo
bal downturn is hitting India's $52 billion outsourcing sector.

India's second largest software services firm however has no plans to cut jobs and is sticking with its third quarter outlook, CEO Kris Gopalakrishnan told reporters.

He said the outsourcing sector's growth rate would halve next year as some customers delay orders.

"Last year the IT industry grew more than 30 per cent, this year it is looking at somewhere in the region of 15 per cent," Gopalakrishnan said.

India's export-driven IT sector, used to a scorching pace of growth, has been hit by the financial crisis and recession in the United States, which contributes more than half their revenue.

In the last few years, the outsourcing industry has created tens of thousands of jobs, mainly attracting young workers, as global companies look to trim labour costs.

Infosys hired 16,000-17,000 employees in the first half of the fiscal year that began in April and would honour commitments to 6,000 under training, Gopalakrishnan said.

Infosys, which counts Goldman Sachs and Philips Electronics among its clients, cut its full-year dollar revenue outlook in October due to the worsening global downturn.
Gopalakrishnan said that the company would freeze fresh recruitment, apart from meeting specific skill needs.

"We will have to look at controlling our cost, controlling our expenses making sure that we run an optimised business. We will have to look at what are things we need to do in order to prepare ourselves for the recovery."

"Growth is coming more and more from emerging markets so these are the things we need to prepare ourselves. We should not lose momentum in this s
lowdown," he said.

But Infosys still expects its strong client base and a weakening rupee to help it meet a forecast for December quarter earnings of $0.57 a share. The Indian rupee has fallen nearly six per cent so far this quarter against the dollar.

"Infosys is seeing further degradation of the demand environment, with headwinds from leadership changes at customers, a shrinking large deal pipeline .... Pricing pressure has emerged," CLSA Asia-Pacific said in a report this week.

By 0845 GMT, Infosys shares were up 2 per cent in a Mumbai market, but outperforming a 4 per cent gain in the broader Mumbai market. Infosys shares have fallen 33 per cent so far this year.

Courtesy: Times of India

Adobe cuts jobs, lowers outlook

SAN FRANCISCO: Adobe Systems Inc lowered is revenue outlook and said it will eliminate 600 jobs, or around 8 per cent of its workforce, due to the
weak economy, sending its stock down 7 per cent in extended trading.

"The global economic crisis significantly impacted our revenue during the fourth quarter," said Shantanu Narayen, the company's chief executive, in a statement. "We have taken action to reduce our operating costs and fine-tune the focus of our resources on key strategic priorities."

Adobe spokeswoman Jodi Sorensen said it would be an across-the-board headcount reduction, impacting all geographic regions and company divisions.

The maker of Acrobat Reader, Flash and Photoshop software took its revenue outlook for the fiscal fourth-quarter ended November 28 to a range of $912 million to $915 million from its earlier view of $925 million to $955 million.

The company also said it expects fourth-quarter adjusted earnings in a range of 59 cents to 60 cents a share, higher than its previous forecast, as it benefited from two favorable tax items.

For the February quarter, Adobe forecast revenue of $800 million to $850 million, well below analysts' forecast range of $846 million to $1.02 billion, according to Reuters Estimates.

Adobe cited weaker-than-expected demand for its new Creative Suite 4 family of products, which began shipping in the quarter, as the main cause of the revenue shortfall.

CS4 is a package of tools for graphical designers that includes Photoshop photo-editing software, 3D computer drawing programme Illustrator, Dreamweaver for designing websites and Soundbooth for audio-editing.

In a conference call in September, Narayen told investors that CS4 would be Adobe's biggest product introduction ever.

The company will record $44 million to $50 million in charges related to the headcount reduction, with $28 million to $30 million of the total coming in the fourth-quarter.

Shares of the San Jose, California-based company closed the regular session up 54 cents, or 2.5 per cent, at $22.54 and fell to $20.55 in extended trading.

Courtesy: Times of India

Goldman Sachs now sees loss of 400,000 jobs in Nov

NEW YORK: Goldman Sachs has revised up its forecast for US job losses in November to 400,000 after reports showing a dismal employment picture in
the private sector, particularly in services.

The analysts at Goldman had previously forecast a decline of 350,000 jobs. The median estimate in a Reuters poll conducted on Friday was -320,000. The Institute for Supply Management's non-manufacturing survey
fell to a record low, as did its employment index.

"Most reports on employment conditions in November have shown additional weakness relative to earlier months, but today's ISM report on conditions outside manufacturing was particularly noteworthy," said Goldman economists in a research note.

"The employment index from this report, which has predictive power for payrolls in the top-down models we have developed, fell more than 10 points from a level that was already the lowest on record for this indicator."

The report also cited weakness in small and medium-sized firms as potentially compounding the pain in the labor market.

Courtesy: Times of India

Look how Google is cutting costs

NEW YORK: Feeling the pinch of the global economic slowdown and the US recession in particular, Google, the Internet search engine giant, is res
orting to austerity measures, The Wall Street Journal reported.

Prominent among them include cutting new projects, ratcheting back spending, chipping away at perks and reducing employee strength. Such measure from Google, which is known for its generous perks, has come as a surprise to many industry watchers.

The latest Google measures are understandable as its revenue growth has slowed down dramatically over the past one year. Google's share price on Tuesday was $275.11 as compared to $741.79 in November 2007.

“We have to behave as though we don't know what's going to happen,” Google chief executive Eric Schmidt was quoted as saying by The Wall Street Journal.

The company will curtail the “dark matter,” Schmidt said, projects that “haven't really caught on” and “aren't really that exciting.”

Schmidt said the company is “not going to give” an engineer 20 people to work with on certain experimental projects anymore. Popular social networking site Orkut was a product of this experiment by Google. Schmidt, however, promised to get this back when things improve.

Google executives had started preparing for the slowdown about a year ago, but things have now accelerated. In recent weeks, Schmidt has held meetings with top executives to determine where to focus investment more narrowly, the Journal said.

Top priorities include display ads, which use graphics and appear on Web pages; advertising on mobile phones; and the company's online business software.

Schmidt says the company is shifting more engineering and sales resources to those areas, and away from less-promising projects. Teams on projects the company is merely "fiddling with," he says, will get "naturally smaller as people get plucked off,” the report said.

The Wall Street Journal said the financial crisis has created a new sense of urgency within the company. Top executives say they remain committed to projects they believe hold long-term potential, but are prepared to “starve” lesser ones.

Courtesy: Times of India