Dell, the well-known laptop manufacturer, joins the list of technology giants cutting thousands of jobs as the pandemic’s remote working trend fades. The US tech firm recently announced plans to lay off 6,650 jobs, representing about 5% of its workforce, as market conditions continue to deteriorate with an uncertain future. Founded by entrepreneur Michael Dell back in 1988 and currently valued at around $30 billion, Dell offers a range of products and services such as consumer laptops, desktop PCs, IT infrastructure, and software catering to businesses.
During the pandemic, Dell experienced a surge in profits and revenues as spending on personal computing and IT gadgets soared. However, as businesses call employees back to the office, demand for new PC hardware has slumped, along with consumers’ spending amid the economic slowdown. According to data from analysts Counterpoint, global PC shipments plunged by 27.8% in the last quarter of 2022, with Dell’s market share of global PC shipments dropping to 16.7%, its lowest in two years due to the wider slowdown in laptop sales.
Jeff Clarke, Dell’s chief operating officer, told employees in a note that more effort is needed to cut costs, as they have already implemented several measures, such as cutting employee perks and travel. He reassured the team that Dell has navigated past economic downturns and emerged stronger, and that they would be ready when the market rebounds.
In response to the slowdown in demand for new PCs and IT hardware, HP and IBM have also recently reduced their headcounts by about 12% and 1.5%, respectively, shedding 6,000 and 3,900 jobs. While Dell’s shares fell by around a third in 2022 due to the sell-off in technology stocks, the economy remains close to effective full employment, with jobless numbers at their lowest in close to 50 years.
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