Sources: Intel Layoffs May Be Imminent

In the next step of its sweeping reorganization plan, Intel may be preparing to let go of as many as 22,000 workers worldwide, according to media sources close to the affected operations. The announcement may come from the company as soon as today, according to the Financial Times, which cites analysts as saying the final job cut number may come in at around 10,000, once those affected have been notified after returning from their Labor Day holiday.

Intel's operations in Israel could be severely affected by these cuts, if the fears of the Tel Aviv-based newspaper Ma'ariv are realized. Last December, Intel announced it would be expanding its 300 nm fabrication facility in Kiryat Gat to handle production of 45 nm components, supplementing that plant's current 90 nm line.

But the company is already further along in building a second 45 nm facility in Chandler, Arizona, where 65 nm parts are already being produced. Ma'ariv reports as many as 20,000 jobs could be severed if expansion plans for Kiryat Gat are put on hold; the Israeli business daily Globes estimates a number closer to 6,500.

In nearby Haifa, Intel houses the research facility responsible for developing the power-saving technology featured in the company's Woodcrest, Merom, and Conroe processors, introduced just last June and July.

Last December, the company confirmed it would receive over half a billion dollars in subsidies from the government of Israel for expanding its Kiryat Gat operations. If it turns out that Intel must scale down its plans there, the fate of those subsidies could be jeopardized. Some might argue it would be cheaper to keep those folks employed.

Meanwhile, the Kuala Lumpur-based Star reportedly intercepted an Intel company memorandum referring to the implementation of another voluntary separation scheme, with the goal being to eliminate up to 2,000 more jobs in the company's Malaysian operations.

Late last week, the Irish Saturday Business Post reported Intel would be implementing a similar scheme in that country as well. Only two and a half months ago, Intel completed the refurbishing of its Leixlip fabrication center there, to handle 65 nm production.

"Voluntary separations" have been a principal part of nearly every major Intel corporate restructuring - there have been several - since 1985.

In April, Intel CEO Paul Otellini announced his company would be implementing a series of massive restructuring changes, the details of which were supposed to have been revealed in totum in later months. Instead, portions of the plan have been implemented almost ad hoc, including a sale of the company's communications chip business to Santa Clara-based neighbor Marvell last June, followed by a sale of its media and signaling division to Eicon Networks in August.

BetaNews has contacted Intel this morning, which indicated that an announcement could be forthcoming.