Michael Dell believes that his company still needs to trim costs

Dell to slash 8,000 jobs

Rebuilding effort to cost 10 per cent of its workforce

Written by Shaun Nichols in California

vnunet.com, 01 Jun 2007

Dell is to reduce its workforce by more than 10 per cent over the next 12 months, losing a potential 8,000 permanent and contract jobs.

News of the layoffs follows Dell's first-quarter earnings report of $946m in income, up 14 per cent from a year ago.

Despite the profits, chief executive Michael Dell maintained that the company still needs to trim costs and strip down its operations.

"Our strategic intent is to simplify information technology for our customers by removing cost and complexity," he said in a statement.

A company spokesperson told vnunet.com that Dell's employee head count stands at 88,100, around 82,000 of which are permanent positions.

Dell is in the middle of a restructuring in an attempt to fend off stiff competition from HP, which overtook Dell for the top spot in the consumer market early this year.

The effort has included bringing founder Michael Dell back as CEO, unveiling a line of Linux PCs and opening its first retail operation through US chain Wal-Mart.