Hewlett-Packard Co. employees in Conway may be impacted by the cuts the tech giant recently announced will be looming until a company-wide overhaul is completed in 2014.
The largest tech company in the world by revenue, which employs more than 1,000 locally, announced a streamlining effort Wednesday that would eliminate 27,000 positions. The cuts amount to about 8 percent of the company’s workforce of 349,600.
HP said it would save $3 billion or more annually from the job cuts and other measures.
An HP spokesperson said Thursday no specific plans have been released with regard to how the cuts may affect Conway, but said, "We do expect the workforce reduction to impact just about every business and region."
HP expects to use savings from the cuts to boost investment in innovation in three areas — cloud, big data and security — and in areas that have "growth potential," according to a news release Wednesday.
Last year, HP announced it was leaving smartphones and tablets behind for more business-specific equipment and services. The largest takeover in 73 years was announced at the same time, and the company bought business software provider Autonomy Corp. for about $10 billion.
The same day HP released its plans to purge workers and offer early retirements, second quarter results released showed a 3 percent decline in net revenue.
The Associated Press reported that the decline was expected, but factored in well below projections, which analysts expected to be $800 million more.
Revenue was reported at $30.7 billion.
Though there isn’t a figure assigned to Conway’s customer service and technical support center’s impact on the local economy, the center has a payroll of more than $50 million.
"Obviously this is something we want to keep a close eye on, but it’s important to know that during HP’s time in Conway they have over-delivered on the number of jobs created, payroll and time frame," said Jamie Gates, vice president of Conway Development Corporation. Gates was heavily involved in creating the $36 million local investment package to draw HP to the Meadows technology park, still being developed for additional businesses on the south side of Conway.
"All of our interaction with HP has been positive. I feel good about the future of HP in Conway," Gates said. "They are very important to us, and this is a time when we obviously hope for the best."
An HP spokesperson addressed speculation that a bulk of the company’s layoffs would occur in HP’s services business.
Michael Thacker, global media relations at HP, issued the following statement: "Due, in part, to the people-oriented nature and the sheer size of headcount in our services business, there is likely to be a larger number of headcount reductions in that segment relative to other segments," he wrote in an email.
Gates said Thursday the largest part of the Conway center’s payroll goes to sales positions. According to an HP news release dated for the opening of the facility in 2010, the center does employ workers who provide "customer service for home, business and enterprise clients."
(Staff writer Courtney Spradlin can be reached by email at firstname.lastname@example.org or by phone at 505-1236. To comment on this and other stories in the Log Cabin, log on to www.thecabin.net. Send us your news at www.thecabin.net/submit)