New | Apple supplier Foxconn to cut workers as revenue growth stalls

Taiwan's Foxconn Technology, the world's largest contract electronics manufacturer, will cut its massive workforce, the company said, as the Apple supplier faces declining revenue growth and rising wages on the mainland.

Under its flagship unit Hon Hai Precision Industry, the group employs about 1.3 million people during peak production times, making it one of the largest private employers in the world.

Special assistant to the chairman and group spokesman Louis Woo did not specify a timeframe or target for the cuts, but noted that labour costs had more than doubled since 2010, when the company faced intense media scrutiny following a spate of worker suicides. "We've basically stabilised [our workforce] in the last three years," Woo said. When asked if the company plans to reduce overall headcount, he responded "yes".

Revenue growth at the conglomerate tumbled to 1.3 per cent in 2013 and only partially recovered to 6.5 per cent last year after a long string of double-digit increases from 2003 to 2012.

That decade saw the firm ride an explosion of popularity in personal computers, smartphones and tablets, largely driven by its main client Apple, but now it is feeling the effects of falling growth and prices in the gadget markets it supplies, a trend that is expected to continue.

Growth in smartphone sales will halve this year from 26 per cent last year, according to researcher IDC, while PC sales will contract by 3 per cent.