The cuts came to light after Santa Clara, Calif.-based Marvell announced that it had completed its purchase of Avera Semiconductor, which GlobalFoundries spun off in October 2018 as an 800-employee-strong, wholly owned subsidiary with workers in Vermont, New York and overseas.
The division focused on the design and development of cutting-edge chips known as ASIC — application-specific integrated circuit semiconductors.
Laurie Kelly, vice president of communications for GlobalFoundries, said the 800 Avera employees were “transferred” to Marvell as part of the sale. GlobalFoundries still has about 2,300 employees at its Essex Junction campus.
She understood the “majority” of the transferred employees would be continuing their employment with Marvell, but she said it was up to Marvell to discuss layoffs. Marvell, which specializes in chips for wireless applications, made no mention of cuts in its initial press release Tuesday about the sale.
In response to repeated questions, Marvell issued a statement Wednesday night that read, in part, “a number of functions between the Marvell and Avera teams were identified as redundant and have resulted in the elimination of a small percentage of positions worldwide.” The company did not say how many jobs were cut in Vermont.
Seven Days contacted former and current employees and industry insiders and learned that the number of layoffs was substantial, though an exact figure was not available. Public officials have been struggling to find out how many people Marvell laid off.
Workers within the company didn’t know either, according to the laid-off worker who spoke to Seven Days. Based on the number of workers he personally knew or who attended a benefits meeting for those affected, the worker estimated the total number of Essex Junction layoffs at 30 to 60.
The former employee said he got an email Monday evening informing him about a meeting on Tuesday afternoon.
“When I talked to my manager that morning, I didn’t have a good feeling about it,” the employee said. “His body language told me everything I needed to know.”
Rumors of the layoffs circulated widely on Tuesday. Joan Goldstein, commissioner of the state Department of Economic Development, and Michael Harrington, acting commissioner of the Department of Labor, said they were texting about the sale Tuesday evening, trying to figure out if layoffs were likely.
Companies are required to give the state a 45-day heads-up if they plan to lay off more than 50 people, but Marvell has not done so, both said.
Local leaders in Essex Junction were also trying to figure out how big an impact the sale might have on the town, but weren’t having any luck getting information.
“One job loss is one too many, let alone whatever this number will be,” said Andrew Brown, president of the Village of Essex Junction. “We hope all is well with the individuals and their families who have lost their jobs.”
Those with other companies in the tight-knit semiconductor space noticed social media light up with people looking for work.
Wolfgang Hokenmaier, cofounder of Green Mountain Semiconductor in Burlington, said several people he knew lost their jobs. Hokenmaier took out a help wanted ad for his growing firm, he said.
“We are in the fortunate position where we are actually hoping to pick up a couple of those folks who have left,” Hokenmaier said.
The employee who spoke to Seven Days on condition of anonymity said the sting of being let go was lessened by a generous severance package that was “beyond anything I’ve seen in the industry.” Even so, it contained a no-compete clause aimed to prevent employees from being rehired by GlobalFoundries.
Those let go were to be paid through the end of the year. Workers are getting up to 26 weeks of pay as severance, one week per year of service. And the company is extending its benefits for six months, he said.
“It was a huge relief,” he said. “I gotta give credit to Marvell. They handled it very well.”
Colin Flanders contributed reporting.
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The State gave Global Foundries $1 million in early 2016 after they bought IBM.
Good investment?
Marvell purchased a piece of Global Foundries and subsequently laid off some people . That’s sad.
To have the State Auditor imply that it was Global Foundries that laid of the individuals is simply wrong.
As to giving a million dollars to Global Foundries, I’d prefer the Auditor conduct an audit. How about providing a cost benefit analysis of Vermont’s legislature airdropping taxpayer cash to private business instead of virtue signaling on a Democrat owned message board Doug?
Seeing as Dealer just laid additional folks off, perhaps the Auditor can comment on whether or not it was wise to give them taxpayer money too.
Jimmy (last name?) – We gave the money to GF. They sold that piece off and walked away from those employees. The money was supposed to be a combination thank you and inducement. How did that turn out?
As for an audit, I commented on the $1 million at that time. Statute allowed me to weigh in on the request by the Governor and I said it was not a sensible expenditure.
Re. state incentives & Dealer: We recently released a report on that (and numerous other econ. dev. issues) which you can see here.
https://auditor.vermont.gov/sites/auditor/…
I have challenged the cost-effectiveness of our incentive programs for years. Where have you been?
Auditor Hoffer once again attacks VEGI Incentives to businesses based on the premise that expansion would have occurred on its own without any state assistance.
Maybe and maybe not.
What the Auditor overlooks is the fact that other Northeastern states are offering a myriad of incentives to attract @nd grow businesses. New York attracts businesses by offering 10 years of no taxes in addition to work force training and development grants. New Hampshire offered revision of NewPort tax incentives to relocate in the granite state. And sadly, Auditor Hoffers answer is to stop incentivizing businesses to grow and relocate to Vermont.
How will Vermont win the game if we stop playing?
Does Auditor Hoffer live under a rock? The purpose of corporate welfare is to ensure we’re competitive with other states. Yes, it’s a zero-sum game that does not lead to innovation and economic growth, but that’s not what the Auditor’s critics are arguing. We’re arguing that in a flat (in the Thomas Friedman sense), mobile economy it’s economic suicide to not participate in this zero-sum game.
This is particularly important for Vermont, as we’re sandwiched between Massachusetts and New York; two states that relay heavily on corporate welfare for economic development (look to the new Norsk Titanium plant in Plattsburgh or the over $200k-per-job the Mass legislature approved to pay GE to move their headquarters from Connecticut to Boston). If VEGI is not competitive with what these states offer (spoiler alert: it’s not), then Vermont will continue to hemorrhage good-paying jobs to states that offer employers more.
Doug (Partisian?) -Global Foundries sold a portion of their business to Marvell. Global Foundries did not walk away from those employees. Sadly, Marvell chose to layoff some of the employees after the sale and your cheap shot should be at Marvell, not Global Foundries. Attempting to confuse the issue helps no one.
You provided link regarding Dealer and incentives. While I requested an Audit, what you provided was non-audit report which makes no clear recommendations and offers no course of future action. Therefore, your report is of little value to Vermonters or our elected leaders and is just another expensive binder in a cabinet in Montpelier.
As you know, the legislature appropriates all funds spent by the State of Vermont. It is pathetic partisanship to attempt to put blame for this wasteful spending solely on the Governor.
Doug, I challenge you to call out this outrageous spending and put the blame for this waste where it rests, at the feet of your buddies in the Democrat controlled legislature. You know, the folks who actually create and pass the spending bills.
Courage Doug. Courage!
To those three fellas that challenge my position (two who can’t even use their own names), I offer the following. This is from the Abstract of a study released last year by the country’s leading authority on these matters.
“Incentives benefits versus costs depend greatly on what percentage of incented firms would not have made a particular location/expansion/retention decision but for the incentive. Based on a review of 34 estimates of but for percentages, from 30 different studies, this paper concludes that typical incentives probably tip somewhere between 2 percent and 25 percent of incented firms toward making a decision favoring the location providing the incentive. In other words, for at least 75 percent of incented firms, the firm would have made a similar decision location/expansion/retention decision without the incentive.”
But For Percentages for Economic Development Incentives: What percentage estimates are plausible
based on the research literature?
Upjohn Institute Working Paper 18-289
Timothy J. Bartik
https://research.upjohn.org/up_workingpape…
Doug can’t or won’t stick to the topic at hand.
Marvell laid off workers yesterday, not Global Foundries.
The legislature authorizes the spending of incentive funds, not the governor. Doug won’t call the legislature out for wasteful spending, but chooses to take shots at the governor. Gee, I wonder why?
Doug can’t offer evidence of an audit on incentives, just a costly non-audit report with no recommendations, and as a result, no value to the taxpayer or elected official.
Doug has no interest in remaining independent, choosing to defer to the AG and wait to audit the EB-5 ripoff, while protecting his state employed and elected buddies.
https://vtdigger.org/2019/09/10/criminal-c…
Who is partisan Doug really looking out for? It doesn’t appear to be the taxpayer.
Well, here’s another avenue that hasn’t been investigated : GF broke off their engineering shop, & made it “Avera,” and that was what was sold to Marvell. So, if fewer than 50 former Avera employees were let go,
then Marvell is beneath the threshold for reporting that to the State. HOWEVER — if the newly unemployed worked as CONTRACTORS for multiple “job shop” firms, there may be much more than 50 people affected, fro several firms, and the State would be unaware.
Not that it matters — the State is virtually unable to find (or even suggest) a new employer for someone with a B.S. , Masters, or PhD in Applied Science. When IBM cut 400+ engineering staff from this same area in 2013,
the State had seminars for the affected people, with presentations listing $15/hour jobs to replace the lost
6-figure paychecks.
For those who don’t normally think of things in those terms, that 2013 layoff cost about 40 million dollars
in lost payroll, translating into about $2.4 million in lost income tax revenue alone.
Jimmy – You really should get your facts straight. The Governor I criticized was Peter Shumlin. The report we produced was intended for the legislature.
Perhaps if you told us your name, we could better understand your desire to keep making this partisan, which it’s not.
Finally, you said, “Doug can’t offer evidence of an audit on incentives.” If you bothered to read the document you so cavalierly dismiss, you would understand why we can’t audit VEGI.
Stick with your soundbites. I’ll stick with the facts.
Hey, Jimmy, ya know, your Republican governor has approved these incentives for the last three years. It isn’t all the legislature. And you are clearly using this comment section to attack a man who had nothing to do with the incentive. We should all be concerned when we join the game of paying companies to come here, when it doesn’t work out. The fact that other states are doing it is no reason for us to jump on board.
Agreed Doug. As a progressive, you criticized Democrat Peter Shumlin. Reading my comments, I don’t see where I stated your criticism was of a Republican governor. That was an assumption on your part, and an incorrect one at that.
You still refuse to call out the legislature which appropriates the funding for this ongoing waste.
As for an audit, if you don’t have the courage to demand that taxpayers have information on the ROI of their investments, then perhaps you should step down, Your deferring to the AG on the EB-5 scandal is yet another example of your unwillingness to fight for the people of Vermont.
Lastly, it was Marvell that laid the workers off, not Global Foundries. This was the initial error in your string of evasive screeds.
Hoffer’s postings:
8:21 am = taxpayer paid work time?
12;57 pm = taxpayer paid work time?
2:02 pm = taxpayer paid work time?
knowyourassumptions – Don’t you just hate it when elected officials communicate with citizens about their work?
State Auditor, Secretary of State, State Treasurer __ these elected positions should not allowed to be partisan, or stepping stones to higher office.
All candidates for these offices should not be allowed to run under a party banner. Is there any such thing as a Republican Auditor or a Progressive Auditor? No, there is only someone who is qualified and someone who is not qualified to be an auditor. It is a professional job. Not a political job.
Heres how to keep these offices from Flanagan-ism, Ready-ism, and Douglas-ism: Anyone who is elected to Auditor, Secretary of State, or Treasurer should not be allowed to run for another statewide elected office for 4 years after they cease holding one of these offices.