Magazine article Workforce Management

Sector Is Likely Able to Absorb Intel Job Cuts

Magazine article Workforce Management

Sector Is Likely Able to Absorb Intel Job Cuts

Article excerpt

TECH MARKET

With 10,500 employees being cut from Intel's payroll during the next year, one question facing both employees and employers is whether the tech market will be vibrant enough to absorb them all.

Early this month, Intel announced it would eliminate about 10 percent of its workforce by mid-2007. The company said the job cuts would come from attrition, workforce reductions and the already announced sale of businesses. Analysts expect that attrition will account for as many as half of the total.

Intel said workforce cutbacks would come from management, marketing and IT functions, but gave no indication on the relative allocation. The announcement came the same day that the Tech sector Index, published by Forrester Research and the Information Technology Association of America, announced a mixed outlook for technology for the fourth quarter of 2006 and beyond.

With virtually full employment within IT today, the market that IT job seekers will encounter beyond the third quarter of 2006 should be a "good" market, rather than today's "very good" market, according to Andrew Bartels, an analyst at Forrester Research.

"We're not talking about negative growth, but a slowing of growth," he says. "What that most likely means is not job cuts, but a reduced rate of hiring, especially on the IT department side."

The Forrester/ITAA index stands at or near a four-year high. However, its forward-looking indicators point to only modest growth in the third quarter and weakening results for the fourth quarter and beyond. …

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