Dell job cuts - High-cost jobs are at greater risk

THE bombshell news of job cuts in Dell, the jewel in the crown of Ireland’s computer industry, has ominous implications for the information technology sector.

The computer giant is axing 10% of its worldwide staff or 8,500 jobs in response to waning competitiveness. If this 10% figure is applied to Dell’s 4,500-strong workforce in Limerick and Dublin, around 450 jobs will be shed.

Dell has built a mirror plant of its Limerick operation in Poland where wages are one-third the Irish rate, raising further concerns. Not surprisingly, a number of other Irish-based multinational corporations are also shifting to low-cost economies in Eastern Europe.

Compounding the threat to Ireland’s biggest exporter, the latest economic data reflects a weakening of the economy. While Dell’s corporate European headquarters is an important status symbol for Ireland, it is by no means a guarantee of job survival in the Irish arm of a global company in trouble.