Mitsubishi to double chip unit job cuts
1000 more contractors to lose contracts
Mitsubishi, Japan's fifth biggest chip maker, will rid itself of 2000 staff employed by its semiconductor operation - twice the number it said last week it would eliminate in the light of a collapse in the company's projected earnings.
Chip production will be cut 26 per cent.
The company currently employs 8000 people, around 4000 of them third-party contractors. Last week's announcement said the latter group will be reduced by 1000 staff by March 2002. The extra cuts, announced today, will be made in the next fiscal year, commencing April 2002, and also affect Mitsubishi's contractor workforce.
That, say analysts cited by Bloomberg, won't do much to boost the company's earnings. Full-time employees are almost always much more expensive to maintain than contract labour.
And earnings is an issue for Mitsubishi. Last week is said it now expects the current year's profit to fall to just three per cent of what it was predicting earlier this year. Mitsubishi as a whole will make ¥2 billion ($17.05 million) - well down on the ¥75 billion if forecast before. Sales will come in at ¥3.9 trillion, 9.3 per cent less than previously predicted. ®