GlobalFoundries has told its employees that it will lay off about 5% of its workforce in coming weeks, as the semiconductor company anticipates a downturn in demand for its products.
GlobalFoundries currently employs about 2,000 people at its plant in Essex Junction, making it Vermont’s largest private, for-profit employer. The company did not say how many Vermont workers might be affected by the cuts.
“As part of a recent all-employee meeting, we shared the cost saving actions we are taking across our business in response to the current macroeconomic environment,” company spokesperson Julie Moynehan said in a written statement to Vermont Public. Those actions include “reducing corporate and manufacturing overhead costs as well as selectively reducing our workforce by less than 800 employees globally before the end of the year.”
Moynehan declined a request for an interview, and would not detail which company locations and departments will be affected by the planned job cuts.
According to a company overview document published earlier this year, GlobalFoundries employs about 15,000 people worldwide. Besides Vermont, the microchip maker has manufacturing sites in upstate New York, as well as in France, Germany and Singapore.
Just last month, the company reported $2 billion in revenue in the third quarter, amid what CEO Tom Caulfield described to investors in a call on Nov. 8 as a “year of record output.” Despite strong revenue growth, Caulfield said he expected customer orders to decline in the first half of 2023, which he said made it necessary to take “actions to contain costs.” Days later, the company confirmed it was implementing a hiring freeze and planned to lay off workers.
The planned layoffs come just as federal and state officials have pledged monetary and regulatory support to the company’s Essex Junction plant, known as “Fab 9.”
In October, Sen. Patrick Leahy announced a $30 million grant for equipment upgrades at the site. Days later, Vermont’s Public Utility Commission approved a long-running push by the company to create its own electric utility, in an effort to cut power costs. And the company expects to soon receive subsidies authorized under the CHIPS Act, a bill intended to support domestic semiconductor manufacturing signed by President Joe Biden in August. Caulfield has said the company intends to invest some of those funds in Fab 9.
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