HP has confirmed the news of splitting into two companies: Hewlett-Packard Enterprise and HP Inc. Hewlett-Packard Enterprise will be doing business of technology, software, and services. While the other company, HP Inc will be focusing on PC and printing business. The decision to separate into two companies is seen as an opportunity to grow as both the companies will have independence and resources to focus on one particular market.
All being said, the decision will see some 5000 employees losing their job after the decision comes into effect by the next year. The decision is also based on the fact that the company wants to reduce its debt “at the operating company level”. In other words the 5000 jobs loss is the result of cost reduction method. No doubt the decision will leave some 5000 employees jobless at a time when the global economy is still recovering from the global recession.
HP’s current chief executive, Meg Whitman, will be the president and CEO of Hewlett-Packard Enterprise, while Dion Weisler will become president and CEO of HP Inc. Meg Whitman had said the decision to split was inevitable and its will give the company the much needed boost as far as the business is concerned.
HP is not the first company in recent years to have huge layoffs on a global scale. Other big names like British multinational banking and financial services company, Barclays also had huge layoffs and closed down its branches in many countries. This left some 19000 employees unemployed. HP’s split decision is likely to affect the job market and only the future can tell if there will be some more lay-offs from major multinational companies.