Nokia to cut 1,100 jobs

Nokia is to shut down its mobile devices research and development (R&D) site in Jyväskylä, Finland, and will scale down operations at its Salo production site. Moves in the company are expected to affect a total of around 1,100 workers.

The manufacturer's R&D operation will run from sites in Tampere, Oulu, Salo and the Helsinki metropolitan area.

Nokia also plans to scale down Salo production with staggered temporary lay-offs, aligning production with market demand while continuing operations without interruption. Nokia is to begin consultations with employee representatives about these plans.

The redundancies and site closures will increase Nokia's cost-efficiency to deal with the economic recession. It said the moves are in line with cuts to its handset portfolio.

Nokia's operations in Jyväskylä focus mainly on handset development and marketing. It plans to gradually wind down the site and close it by the end of 2009.

The planned change will affect about 320 employees working at the Jyväskylä site.

Nokia senior vice president for devices R&D Peter Røpke said: "Our employees in Jyväskylä are highly competent and have contributed to the creation of numerous hit products.

"The planned closure of the Jyväskylä site is an unfortunate, yet unavoidable measure. We must adjust our resources to reflect reduced market demand in order to maintain our competitiveness also in the future."

In Salo, Nokia will implement temporary lay-offs on a rotational basis, with operations at the factory continuing without downtime. This arrangement is based on Finnish labour practices and legislation.

Up to 30 per cent of the site's 2,500 employees are to be temporarily laid off on a rotational basis.

Nokia senior vice president for demand supply network management Juha Putkiranta said: "This is one of the measures we are taking to adjust our global demand supply network to the current situation."

Additionally, Nokia will also begin consultations to make 60 potential redundancies within its global support functions and 30 potential redundancies as part of plans to scale down its new services division.

A company statement said: "All of these measures are part of Nokia's previously announced plans to adjust business operations and cost base according to market demand and safeguard future competitiveness. Nokia continues to seek savings in operational expenses, looking at all areas and activities across the company."