There has been considerable discussion online lately about various “recession indicators,” and it appears a significant one may be taking shape.

Reports indicate that Intel is gearing up for potentially the most extensive layoffs in its history.

A recent Bloomberg report suggests that the tech behemoth is looking to reduce approximately 20 percent of its workforce. This would mark the second substantial layoff at Intel within less than a year. In August 2024, the company let go of roughly 15,000 employees. By the end of that year, Intel’s employee count was around 108,900.

A 20 percent cut would imply that over 21,000 employees might be affected.

The layoffs are believed to be part of CEO Lip-Bu Tan’s larger strategy to reorganize Intel, steering the company towards a more “engineering-focused” framework. The objective is to streamline processes, cut expenses, and remove layers of administration.

The previous layoffs predominantly impacted non-engineering positions, such as roles in sales, marketing, and administration. While it remains uncertain which departments will be affected this time, Tan—who assumed the CEO role just last month—has shown a desire to reduce managerial positions.

Intel has encountered increasing challenges in recent years, losing market share to rivals like Nvidia, which has thrived due to the booming demand for AI technologies. Intel’s sales have dropped for three consecutive years, and the company seems to be looking for a significant reset to regain its standing.

As AI continues to promise heightened efficiency and productivity, Intel’s potential actions might also mirror a larger trend in the industry: achieving more with fewer employees.

If the layoffs unfold as anticipated, Intel will join a rising number of tech firms that have downsized their workforces over the last year.