iThings Considered

Layoffs May Hurt Mac Market

Jake Sargent - 2001.02.13

Lucent Technologies: 14,000

Daimler Chrysler: 26,000

Xerox: 4,000

Textron: 3,600

Gateway: 3,000

AOL Time-Warner: 2,400

Hewlett Packard: 1,700

Amazon.com: 1,300.

What are these numbers? They are job layoffs that the above companies have announced since the beginning of the year (a total of 142,200). Up until a few days ago, I read about these layoffs and dismissed them as an unfortunate forecast of the future of our economy. It was only when I read that Motorola has plans to let go of 4,000 of its workers that I realized the true impact these job cuts have on our daily lives, and, in this case, the future of Macintosh.

As MacCentral reported earlier this week, the layoffs at Motorola may have an impact on G4 production. This couldn't have come at a worse time. Only a month ago, Steve Jobs introduced new Power Mac G4 towers with a 733 MHz processor, a processor that is likely to encounter many manufacturing obstacles. If Motorola is not able to manufacture the quantity of chips needed to meet the demand of this new machine, the future of the G4 may be in question.

To top things off, Adobe has recently announced some layoffs. Again, this couldn't have come at a worse time. Mac OS X will hit store shelves on March 24th, and Apple needs Adobe's products to be carbonized shortly after its release - or many Mac professionals will not make the upgrade.

On a different note, it may make some Mac users happy to know that the PC market isn't doing so well. Both Hewlett Packard and Gateway have recently announced thousands of job cuts. HP is cutting back 1.9% of its workforce as part of a "company reorganization." The cuts will primarily take place in its sales and marketing divisions. Gateway's job cuts come after the company missed lowered fourth quarter earnings on January 11th due to less demand for PCs (consumers may finally be seeing the light).

Many companies in the same industry as Apple are announcing job cuts - will we see any from our favorite fruit flavored company?

My guess is no. Apple has survived in the past by being the company that doesn't follow the herd. And because Apple doesn't use the same marketing and sales techniques as other computer manufacturers, I think it would be unfair to predict Apple's future based on the performance of Gateway, Hewlett Packard, and Compaq. Furthermore, Apple's problem isn't with a lack of demand like these other companies - it's meeting demand. If Apple is able to manufacture a good number of PowerBook G4s and G4 Towers, I predict that it will have a good quarter.

What is causing all of these layoffs? Is the slowdown in the Internet economy hurting Adobe's software sales ? Are the slowing demands in the automotive and communication industries causing Motorola to reduce its work force? And is this just the beginning, will we be seeing job cuts from similar companies shortly? All of these are questions that are yet to be answered.

The number of job cuts in both the Mac market and the outside world will surely have an impact on the kinds of products and performance we see from these companies in the coming months. We can only hope for a more lively economy next quarter. My fingers are crossed that Motorola will continue to develop the G4 and that Adobe will continue to support the Mac for many years to come.

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