China – Lenovo, the biggest personal-computer maker in China has decided to eliminate 2,500 jobs due to a weakening demand for personal computers.

According to a report by Bloomberg, Lenovo reported a loss for the first time in eight years. Shares fell 16% to HK $2.18 (S$0.42) on the Hong Kong stock exchange. The company is largely dependent on internal demand for its products and demand for laptops has been steadily decreasing in China since the economic downturn.

The 2,500 job cuts include management and executive positions. The company has also resorted to other cost-cutting measures such as reducing expenses on support and staff functions like finance, human resources and marketing. Executive compensation has also been cut by 30 to 50%. This includes merit pay and long-term incentives, as well as any of performance payments for the coming year. 

The company expects these measures to clock savings amounting to about US$300 million (S$444.2 million) in the 2009/2010 fiscal year.