The US company, National Semiconductors, has confirmed it is to shed 600 jobs at its Greenock plant.

BBC Scotland business correspondent Kenny McIntyre: "Major blow for staff"

The company has been in Scotland for around a quarter of a century, and blames the collapse of the global semiconductor market for its latest troubles.

Experts say the news could have been worse since the firm had considered closing the plant altogether.

The global market for semiconductors has been hard hit

National Semiconductors is one of the leading figures in the area of Scotland known as Silicon Glen, where a number of high-tech companies have invested over the past two decades.

The company was not immediately available for comment today, but the job losses would come within a week of another US firm, Viasystems, announcing up to 900 job losses through the closure of two plants in the Scottish borders.

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The Scottish Office said it had been in "close and active" contact with the firm in recent weeks, along with the inward investment agency Locate in Scotland.

"The company is assessing all aspects of its world-wide operational capacity and is expected to make an announcement about Greenock in the near future", said a Scottish Office spokesman.

But the AEEU engineering union renewed calls for action, saying: "The electronics industry is taking a pasting and we need a national response from the Government."

Its Scottish regional secretary, Danny Carrigan, said the union would be seeking discussions with Scottish industry minister Gus Macdonald on an alternative stragegy.

Scottish TUC general secretary Bill Speirs voiced fears that the cutback could be the first stage of a move out of Scotland by the company, and said the job losses were "very,very worrying."

"This country, whose workers have done so much to create National Semi's huge profits in the good years, are entitled to expect a clear commitment to Scotland from the company now that times are better", said Mr Speirs.

Government urged to act

Shadow Trade and Industry Secretary, John Redwood, also called on the Government to move swiftly.

He said: "Gordon Brown came back from the IMF meeting empty-handed.

"Instead of comforting words, he should take some action to reassure the markets."

Michael Moore, industry spokesman for the Scottish Liberal Democrats, said: "Scotland's recession deepens with every passing day.