Microchip Technology Layoffs Expected Tomorrow at Oregon Plant as Sales Plummet and Inventory Piles Up

Chipmaker Microchip Technology indicated that it will lay off factory workers on Monday at its  Oregon and Colorado plants following poor results postings driven by declining sales.

Arizona-based Microchip manufactures embedded chips used in industrial and aerospace systems, consumer products, and cars.

It employs about 900 at Fab4, its Gresham factory. A 45% decline in sales over the first nine months of 2024 to $3.4 billion led to a 91% decline in profits to $154 million compared with the same period in the previous year.

Microchip expanded its Gresham factory in January 2024 after being allocated $72 million in CHIPS Act funding. In December, production shifted to Oregon and Colorado after closing its Tempe, Arizona plant.

Semiconductors are a mainstay of Oregon’s industry, but the sector has been struggling locally for some time, leading to several layoff tranches, such as the 1,300 Intel layoffs at its Hillsboro campus in October 2024.

Microchip indicated that customer demand has fallen steeply, and it currently holds about double the amount of inventory it needs.

Gresham employees were warned on Thursday of layoffs by Microchip Vice President Dan Malinaric, who indicated that job cuts would be less severe than one-third of the workforce initially anticipated. Adding two weeks of additional furloughs is contemplated as a solution to cutting fewer jobs.