Mass layoffs at Philips: 6000 jobs lost worldwide, department in Eindhoven hit hard | Economy

Mass layoffs at Philips: 6000 jobs lost worldwide, department in Eindhoven hit hard | Economy
Mass layoffs at Philips: 6000 jobs lost worldwide, department in Eindhoven hit hard | Economy
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unions shockedPhilips is cutting 6,000 jobs worldwide. In the Netherlands, 1100 jobs will disappear, especially Philips Research in Eindhoven will be hit hard. At Philips in Best and at the High Tech Campus in Eindhoven, the reorganization is estimated to cost between 700 and 750 jobs.

The reorganization comes on top of the cost-cutting operation announced in October, which has already cut 4,000 jobs. With the announcement on Monday morning, a total of 10,000 jobs at Philips will be cut in three months. The news came out with the announcement of weak figures for the past year, which sent the troubled group deep into the red.

The new reorganization, which affects 6,000 jobs, must be completed by 2025 at the latest. Half of that, 3000 jobs, this year. It reported that a second mass layoff under the new CEO Roy Jakobs was imminent and would also intervene in the Netherlands on this scale. Eindhovens Dagblad Friday based on insiders. This concerns ten percent of the group’s workforce in medical technology in the Netherlands. With the new announcement, the total number of Philips employees is likely to fall below 70,000.

Showpiece

Of the 1100 jobs that will be cut in the Netherlands, about two-thirds will disappear in Southeast Brabant: in Best and especially in Eindhoven. The new announcement has a major impact on research and development, traditionally the company’s showpiece. Philips Research is going through a major overhaul. The goal is fewer projects; the company wants to focus much more on larger-scale invention work. Philips wants to focus mainly on areas where the group can be among the market leaders. These include image-guided surgery, ultrasound, patient monitoring and personal care.

At Philips Research, ‘inventors’ are still working on different types of new technology for all kinds of factories in the world. According to the company, roughly 30 percent of the development of new technology still takes place at an umbrella research organization and 70 percent at the location where Philips makes scanners, breathing equipment or software for artificial intelligence, for example.

Much more research and development on location, less central

But in Roy Jakobs’ new plans, research and development will soon be done on location for 90 percent. This means that research and development will soon take place in many more places in the world. According to a spokesman for Philips, the group has done “too many things at the same time” in the past.

Philips wants to decentralize many activities. For example, each Philips unit will soon be responsible for its own marketing. The various branches all have their own factories and their own suppliers, so that no internal battle breaks out for parts.

A spokesman for the group emphasizes ‘that the Netherlands remains the center of gravity of the activities where attention is still paid to groundbreaking innovation with a lot of potential’. The company says it has exported a total of three billion euros from Best (medical scanners, equipment for keyhole surgery) and Drachten (shavers, toothbrushes) in the past year.

Philips moves head office in Amsterdam

The company also announced the relocation of its headquarters in Amsterdam. The medical group trades in its Breitner Center on the Amstel for a smaller office building on the Amsterdam Zuidas. There, an existing office is stripped by a developer, renovated and expanded to 18,000 square meters. According to The parole the property was purchased in 2020 for more than 82 million euros by the American real estate investor Nuveen Real Estate. Philips now has 24,000 square meters of office space in the Breitner Tower.

The mass layoffs and the changes in the way of working have everything to do with the apnea crisis in which Philips has been embroiled for more than a year and a half. In addition to the problems with the sleep apnea devices, Philips continued to suffer from supply chain disruptions and high prices for materials and energy.

CNV

The CNV union is ‘shocked’ at the job losses and thinks that the reorganization offers ‘no guarantee of calm waters’. CNV director Arjan Huizinga points out that the four previous top executives at Philips always implemented major changes shortly after they were appointed. “Why would a new course help Philips this time in the long term?”

“Each time, a bald head among the employees is part of the solution to help the company further,” says Huizinga. “But it is precisely these people who do everything they can to make Philips a fantastic company. It would be much more desirable to stop paying dividends to shareholders for one or two years.”

The CNV member believes that Philips employees whose jobs are now retained should actually be given an employment guarantee. “If you are so confident that a new business model that will lose 1100 jobs will help you recover, you can give the people who are left behind some certainty.” He also insists that Philips does not keep its employees in uncertainty about their future with the company for too long and that Philips deals generously with the voluntary severance scheme and the placemaker scheme from the ongoing social plan.

The dismissal round has arrived ‘hard’ at the FNV union, says FNV director Hans Wijers. “These are such large numbers, it is dramatic. And it remains to be seen whether the layoffs will help. Now 1100 people are leaving, but where does it stop? What is the guarantee that a new round of layoffs will not materialize in 2024?” asks Wijers. He hopes it will stop, even though, according to him, the figures show that things did not go well for the tech company from Eindhoven last year.

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The article is in Netherlands

Tags: Mass layoffs Philips jobs lost worldwide department Eindhoven hit hard Economy

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