Sony has announced that it will reduce its work force by 4%, slashing 8,000 jobs. The company is trying to cut costs by $1.1 billion a year as a global downturn and stronger yen batters profits at the Japanese electronics maker. Sony has 185,000 employees worldwide and it said that it will complete the layoffs by the end of March 2010. It seems that the global financial crisis is hitting this company too, as all big companies face recession. Sony's announcement is not alone. Other Japanese manufacturers have to deal with these problems too, as clients don't have money to buy their products.

However, Sony is particularly vulnerable to the strong yen since about 80% of its sales come from overseas. The dollar has dropped to about 93 yen from 117 yen last year, therefore eroding the company's foreign income. These layoffs will come from Sony's electronics business, which has 160,000 workers, but the job cuts will vary by country. This decision comes after the company tried to avoid the crisis by lowering production and inventories. Furthermore, this cost-cutting plan postponed an investment to boost production of LCD display TVs in Slovakia.

Sony will end production at some plants, including one in France and will move electronics production to lower-cost countries. In addition, manufacturing sites will be reduced by about 10 percent from 57 today. For the following fiscal year, ending in March 2010, the Japanese company announced it will reduce investment in electronics by 30 percent. Sony will also cut at least 8,000 temporary jobs by the end of March, 2010, but temporary workers are not part of Sony's global work force. There it is, 16,000 people laid off due to economic crisis, and Sony really has no other option.