Not TCS, Infosys, or Wipro—This Global Chipmaker Plans to Cut 5,000 Jobs Amid Market Slowdown
STMicroelectronics’ multi-year workforce reduction plan comes as it battles industry headwinds and government scrutiny.
Major Workforce Cuts Announced
In the latest wave of tech layoffs, STMicroelectronics, a leading Franco-Italian semiconductor company, has confirmed plans to cut up to 5,000 jobs over the next three years. This includes 2,800 job cuts announced earlier this year, as part of a broader cost-cutting program aimed at weathering market volatility.
Speaking at a BNP Paribas event in Paris, CEO Jean-Marc Chery revealed that the reductions will include:
- 2,000 job exits via natural attrition and voluntary retirement
- 2,800 targeted layoffs, mainly across Europe, as part of ongoing restructuring
- A broader effort to save hundreds of millions of euros by 2027
“One country specifically is proving more complex and may slow down our pace of implementation,” Chery noted, referring to ongoing negotiations with Italian authorities.
Italy Pushes Back as Concerns Mount
Italy’s government—one of STMicro’s major shareholders alongside France via a joint 27.5% holding—has expressed concern about the layoffs. Talks between STMicro and Italian officials are still ongoing, with Rome urging the company to limit cuts in Italy to 1,000 jobs.
Tensions were further escalated by allegations of insider trading involving Chery, which the company has strongly denied. The controversy comes amid a sustained downturn in semiconductor demand, impacting STMicro’s automotive and industrial markets.
France Sees Early Exit Deal Progress
While Italy has resisted aggressive downsizing, France has already reached a partial agreement. In April, STMicro confirmed that 1,000 jobs in France would be cut through voluntary departures. These moves are designed to soften the impact of layoffs by avoiding forced redundancies wherever possible.
Market Outlook: A Glimmer of Hope
Despite the internal challenges, Chery offered a cautiously optimistic outlook, stating that the semiconductor market could see signs of recovery in 2025. Investor confidence appears to have rebounded, with STMicro’s stock jumping 11.1%—its biggest single-day gain since March 2020—closing at €24.94 per share.
Final Takeaway
While Indian tech majors like TCS, Infosys, and Wipro remain untouched in this round of layoffs, STMicroelectronics’ strategic workforce reductions mark a pivotal shift in Europe’s tech employment landscape. The outcome of ongoing negotiations with Italy could shape not only the future of STMicro but also set a precedent for how governments respond to job cuts in state-influenced firms amid global economic uncertainty.
