US chip giant Intel is Ireland's largest industrial employer. Since 1989, Intel has invested over $6 billion transforming the 360 acre former stud farm campus in Leixlip, Co. Kildare into a state of the art manufacturing centre of excellence.

Intel, the global chip giant, this afternoon announced it is to cut  294 compulsory redundancies at its Leixlip, Co Kildare, plant. The US company is Ireland's largest industrial employer with a head count of about 5,000.

In a statement, the company said the cuts in its Ireland Fab Operations (IFO) facility and related service groups were due to a decline in demand for its products produced at the facility.

Intel said the redundancies were "regrettable" and that employees and the company would be engaged in a "process of consultation" over the next few weeks to determine which employees will be affected.

"The affected employees will be given the same severance package that was on offer in the voluntary program earlier this year. At this difficult time, Intel management will be working closely with all affected employees to provide support and assistance," the statement said.

The firm said that it had invested more than €6 billion in the Leixlip campus over 20 years, and remains "strongly committed" to its operations in Ireland.

"The staff at the Intel Ireland campus continue to excel and the Intel Ireland management team takes proactive steps on an ongoing basis to allow us to offer positive options to Intel Corporation for inward investment opportunities,"the statement said.

In recent weeks, staff  were told demand for new products had fallen was not materialising as quickly as expected. The briefings had concerns among staff that this may lead to a possible cut in activity and staff numbers.

Intel employs nearly 5,000 staff directly and through third parties. The firm began operations in Leixlip in 1989.

Intel’s Irish operation recently slipped behind the group’s Israeli firm in terms of competitiveness.

Yuval Steinitz, Israel’s finance minister, told the Economist magazine last week: “Other countries will be raising their direct taxes to cover their deficits just when our taxes will be coming down. In five or six years, Israel’s company tax will be lower than Ireland’s. Intel and others will think hard about that when they decide where to invest.”

In the first quarter of this year, Intel announced the closure of six factories in the US, China, Malaysia and the Philippines with a loss of up to 6,000 jobs.