Archive Subsidiary Lays Off 58 Employees

Archive Corp.’s subsidiary in Ann Arbor, Mich., has laid off 16% of its work force due to a slowdown in demand for its tape storage systems that back up data stored on personal computers.

Irwin Magnetic Systems laid off 58 of its 358 employees two weeks ago, said Terri Douglas, spokeswoman for parent company Archive. The layoff is the first at Irwin since Archive acquired Irwin’s previous owner, Cipher Data Products in San Diego, for $141.7 million in April, 1990. Irwin was acquired by Cipher Data Products for $75 million two years ago.

“We have been paring down each of our business units because of the recession,” said Douglas. “We hadn’t touched Irwin yet, and we felt we had to bring their expenses down because of the recent slowdown in the personal computer market.”

Including the layoff at Irwin, Archive has cut about 160 employees since the beginning of the year and now has about 3,000 workers. The company shut down its optical disk subsidiary, Optimem, two months ago.

Irwin’s fortunes are closely tied to PC sales. In the past several months, computer makers, including Compaq Computer Corp. in Houston, have reported lower earnings. As a result, sales of PC backup drives have begun to soften at Irwin, Douglas said.

The layoff at Irwin is the first major action taken by John Jones, who became chief executive last month. He replaced Edwin Carlson, who had been chief executive at Irwin since 1985.