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Foxconn hiring freeze sees Apple shares fall amid fears of slowing iPhone 5 production

Ashleigh Allsopp | Feb. 22, 2013
Apple's stock declines despite Foxconn spokesperson's claims that hiring freeze is due to more workers returning from Chinese New Year than expected

Apple manufacturing partner Foxconn has put a hiring freeze in place at its factories, sparking speculation that the production of the iPhone 5 has begun to slow, and triggering a fall in share price. However, a Foxconn spokesperson has now denied these rumours.

A Financial Times report published on Wednesday claimed that the recruitment freeze was put in place across Foxconn factories in China as the company slows down the production of Apple's iPhone 5.

The FT cited human resources, local government officials and external recruiters in its report, who apparently said that internal notices had been sent out within Foxconn on Tuesday and Wednesday that ordered a hiring halt until the end of March at the earliest because of reduced iPhone 5 orders.

A source said that stopping hires for one month could see the headcount at Foxconn fall by tens of thousands if its turnover of workers remained as high as 2012.

Later on Wednesday, Foxconn spokesperson Bruce Liu contradicted the FT's report during an interview with Bloomberg, claiming that the hiring freeze was in fact due to a larger number of workers returning from the Chinese New Year break than expected.

However, the FT's report claims that, while a spokesperson from Foxconn's Shenzhen factory, Liu Kun, said that 97 per cent of the company's workers had returned to their jobs after Chinese New Year, a second spokesperson from the human resources team at the Taiyuan plant said that almost a third of the workers there hadn't come back.

The news of the Foxconn hiring freeze, despite contradicting reports about the cause, has led to a 2.4 per cent decline in share price due to concern about a decreasing demand for Apple's smartphones with competition from rivals such as Samsung hotting up.

 

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