Intel Cuts Pay by 4% to 8% for Half of Its Work Force

Slumping semiconductor sales have forced Intel Corp. to cut the salaries of nearly half of its work force by as much as 8% and to close all U.S. operations for six days, company officials announced.

“We went with the pay cut, hoping to keep as much of the work force intact as possible,” Intel spokeswoman Glynnis Kaye said Tuesday. The cuts, ranging from 4% to 8%, will affect about 14,500 Intel employees nationwide. Intel employs 24,231 people worldwide.

Intel already imposed two major layoffs this year. About 900 workers, primarily in Oregon and Arizona, were laid off in February, and another 950, mostly Californian workers, were cut in July. In August, the company was forced to furlough most of its U.S. work force for seven days without pay.

Intel plans to close its operations from Dec. 23 to Dec. 31. Workers will be paid for the Christmas holiday and can use two vacation days, Kaye said. The remaining days will not be paid.

In addition, Intel has frozen all merit pay increases, she said.

Intel’s workers were told of the cuts last Thursday, three days before the end of the company’s third quarter, Kaye said. She declined to reveal Intel’s results for the period but said the company will break even or report a slight loss.

In the second quarter ending June 29, Intel lost $7.6 million from operations but managed to post a net profit of $9.2 million from interest and other income.