Toshiba plans to cut five percent of its staff over a period of five years. Direct lay-offs and not replacing the ones who resign or retire is the Japanese giant’s strategy.
About 7,000 jobs will be cut within the next five years at Toshiba out of which about 3,000 employees will be retiring--thus making up for the job cuts.
This decision is in part due to lower profits with the six-moth operating profit decreasing to about 6.98 Mn yen. The company took an 80 percent reduction in profit compared to a year ago. Last year, Toshiba reduced the seasonal bonuses awarded to its employees in an effort to cut down operating costs.
In an effort to help its business become more profitable and reel back from an unsuccessful natural gas business in the US, Toshiba is planning to liquidate its nuclear power cell NuGen, in the UK. If they are unable to buy a buyer for the nuclear power operation the process of closing NuGen will begin in early 2019. Selling off the American liquified natural gas division would lead to a loss of $818 Mn for the company.
In order to survive the winds of change, the laptop seller turned energy provider plans to sell-off its chipmaking arm to a group of investors. Post the restructuring, the business hopes to shift its attention to providing energy storage and supplying semiconductors for automobiles and other infrastructural facilities.
Troubles had begun in the conglomerate when its CEO resigned due to a $1.2 Bn accounting scandal in 2015. Following the aftermath of the scandal failed entries into the natural gas sector propelled the leaders in Toshiba to take drastic steps such as massive job cuts and offloading assets in order to salvage the business.