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The Impact of the Home Office Boom Ending: 6,650 Jobs Lost at Dell
Layla NelsonFebruary 6, 2023
As the pandemic draws to a close, the home office boom it brought about appears to be ending. Dell, the US tech giant that produces consumer laptops, desktops, monitors, and business IT software, is one of the companies feeling the effects of the shift away from working from home. The company announced that it would be cutting 6,650 jobs — about 5 percent of its workforce — due to a slacking demand for new PC hardware.
The pandemic caused an unprecedented surge in demand for personal computing and IT equipment, which saw Dell’s revenue and profits soar. But as companies start calling employees back into the office and consumers cut back on spending due to the economic slowdown, demand for new PCs has plummeted. Data from analysts at Counterpoint showed that global PC shipments fell 27.8 percent in the last three months of 2022, with Dell’s market share of global PC shipments dropping to its lowest level in more than two years.
In response to the slacking demand, other tech giants have started downsizing their workforces as well. In November, Dell’s rival HP announced it would reduce its workforce by about 6,000 employees, or about 12 percent of its workforce. IBM, which makes mainframe PCs for businesses, said last month it would cut 3,900 jobs, or about 1.5 percent of its workforce.
Jeff Clarke, Dell’s Chief Operating Officer, said in a note to employees, “We have weathered economic downturns and emerged stronger. We will be ready when the market recovers.” However, the layoffs come as the US economy is close to effective full employment, with unemployment rates at their lowest level in nearly half a century.
The end of the home office boom has been a difficult transition for many tech companies, but the long-term effects of the pandemic on the tech industry remain to be seen. As the world begins to reopen, companies will need to navigate the changing landscape and find ways to adjust their business models in order to remain competitive.
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