Jerry Yang just announced that he’ll lay off about 10% of Yahoo’s (YHOO) workforce, and today the AP reports that the troubled company is building a $100 million data centre in Nebraska. (Update: A customer care centre too.) The new centre will create 50-100 jobs (reports vary), paying an average $68,700 in order to snag state tax breaks.
CNNMoney’s cost-of-living calculator says a salary of $68,700 in Omaha goes as far as $121,425 in San Jose, or a whopping $172,151 in Manhattan (where Yahoo has offices that may or may not be on the chopping block.)
So, assuming Yahoo moves 100 jobs from Silicon Valley to Nebraska, that’s about $5 million of savings (which leaves $395 million to go).
Yahoo executives have to make tough decisions about who will stay and who will go over the next few weeks. Telling people, “Hey, we’ve managed to save your job, just take a 33% pay cut and move to Nebraska” might be a painless way to generate some voluntary departures.