American Companies Cutting Costs

Posted by on February 11, 2009 in Uncategorized [ 16 Comments ]

It’s obvious…we are in a recession. Recessions lead to bankruptcies, businesses closing their doors, layoffs, job-cuts, and more unfortunate events. Many companies, both small and large, are cutting hundreds and even thousands of jobs and the unemployment rate in the United States is at one of the highest it’s ever been at before.

Many well-known companies are reducing expenses to get through this time. Whether it be outsourcing financial services, switching to VoIP, or implementing online marketing tactics that produce a higher ROI, companies are tightening budgets and unfortunately, cutting jobs. Some of these job cuts might lead to more profit as those companies find ways to make systems better while some of them won’t. Either way, here’s a list of companies that have and will continue to cut costs. If you are looking for a job, I wouldn’t recommend you start here.

  • Sears Holdings – In January, Sears Holdings dismissed 300 corporate employees as consumer spending slumped. Consumer spending will likely continue to slump, so watch for more jobs cuts and possibly even the closing of some Sears locations.
  • Broadcom – They cut about 3% of their workforce (200 workers) and tightened discretionary spending. The latter resolution is probably better than the alternative of cutting back more jobs.
  • Caterpillar – They announced a quarterly profit plunge of 32%, and then fired 20,000 employees. Shortly after, they increased their layoffs from 20,000 to 22,110.
  • Black & Decker – Power tool sales have declined, and most likely will not pick up again any time soon, so Black & Decker will eliminate 1,200 jobs.
  • Sprint-Nextel – This wireless provider giant fired 8,000 workers resulting in more than $300 million in severance charges. But, on the bright side, they will save $1.2 billion a year in labor costs.
  • Harley-Davidson – Experienced a 60% drop in profits in their fourth quarter of 2008, and then fired 1,100 (10% of workforce). Not many people will have much money to buy a Harley-Davidson in 2009, so I don’t foresee profits getting much better. Watch for more job cuts and possible store closings.
  • Intel – Although many have estimated the information technology field will outlast this recession, Intel closes five manufacturing plants and fired 5,000 employees.
  • Target –This popular store cut 400 open positions and 600 employees sue to low sales.
  • Time Warner – Television and movie giant, Time Warner and its subsidies (including big names such as AOL and Walt Disney) laid many people off over the past few months. Time Warner Cable reduced their workforce by 10% (700 workers) because of declining ad revenue and continues to fight the ever-lasting decline.
  • Texas Instruments – Fired 3,400 (12% of workforce) in January alone.
  • Home Depot – After firing about 7,000 at their headquarters, closing all of their high-end home design shops (Home Depot Expo), and several of their original warehouse shops, they also took or severely cut back worthwhile employee benefits and incentives, such as tuition reimbursement, dental insurance, employee discounts, Christmas bonuses, and more.
  • GM (General Motors) – cut production at several plants throughout the US and in January they fired 2,000 in Michigan and Ohio. Watch for more cut backs and possibly more plant closings, especially since the car business is taking a heavy hit during this down economy.
  • Starbucks – Not that there isn’t enough of them anyway, but they are closing 900 stores worldwide and firing 6,700 people in the process.
  • Boeing – An aerospace giant that has historically been a leader announced in January that it will lay off an undetermined number of workers in 2009 as part of a broad effort to reduce costs. They had previously announced the firing of about 4,500 workers in 2008, and then increased the number to 10,000 workers (6% of the workforce). They continue to lay people off and apparently don’t know when they will stop or how many people they will let go.
  • Microsoft – This billion, if not trillion, dollar company had its first mass layoff in its 34-year history. They fired 5,000 people.

Other companies worth mentioning, whether for their continued economic woes, potential for cutbacks, or for another reason, include DHL Express, United Airlines, Reynolds and Reynolds, and Farmers Group.

16 thoughts on “American Companies Cutting Costs

  1. avatarLuke

    This is the stupidest premise I have ever heard. A company is a “WORST” company to work for if they treat their employees like dogs, don’t give them insurance and otherwise treat them like inhuman cogs.

    While laying-off employees isn’t the most wonderful thing to do to your minions, it doesn’t make company X, Y or Z the worst company to work for. I would imagine that Microsoft is still a pretty decent company to work for even though they laid off a small portion of their workforce.

  2. avatarjay

    Home Depot – After firing about 7,000 at their headquarters, closing all of their high-end home design shops (Home Depot Expo), and several of their original warehouse shops, they also took or severely cut back worthwhile employee benefits and incentives, such as tuition reimbursement(actually they didn’t), dental insurance(went up prior to January, actually was planned early last year along with all our benefits), employee discounts(we didn’t have one), Christmas bonuses(6 years ago and it was a frozen turkey), and more.
    But all the other stuff is right! While I am not happy about what has happened, you should at least get the facts straight. It makes it hard to trust the rest of the story..

  3. avatarJeff Simmermon

    @Luke, @ Jay — You can’t trust the part about Time Warner Cable either. I should know — I’m the director of digital communications there. We actually laid off less than 3 percent of our employees, not the ten percent that this “article” states. And this is not fun for me to admit, but we laid off 1,250 people — which is still less than 3 percent of our workforce. The text above claims it was 700 people. It also says the layoffs were related to declining ad revenue, which is patently false. We began restructuring in early 2008, well before the current employment crisis, and these layoffs are largely related to those restructuring efforts.

    This whole article is full of keywords, buzzwords and short on facts. It feels like well-written spam, to tell the truth.

    Jeff Simmermon
    Director, Digital Communications
    Time Warner Cable

  4. avatargbravo Post author

    @Jeff. Thanks for the clarification. Most everyone would agree that Forbes is a very credible source which is where we got the 10% or 700 workers stat (January article).

  5. avatargbravo Post author

    Regarding Home Depot, our blog states that employee benefits were cut back. Not necessarily for all employees, but for some. or

    @anaymous. We were wrong about Walt Disney being a subsidiary of Time Warner although they do have a partnership. Instead, we should have inserted Warner Bros.

    All and all, it is a shame that so many hard working people are being laid off and we wouldn’t wish that on anybody.

  6. avatarDan

    So uh…Nextel laid off 8,000 employees whose average salaries were 150,000?

    I’m to believe that specious math, that’s what would have happened.

  7. avatarAwesome

    Would you rather an entire company go under than lay people off? Nobody wants the layoffs but it is better to keep more businesses afloat than go under. Your qualifications for “worst” are silly. Everyone is laying employees off. It is a tough economy. Let’s talk about really bad places to work not companies trying to ride out the storm.

  8. avatarMark

    Great article! Our company cut cost by reducing the amount of times we travel for meetings we use Video conferencing and teleconferencing. Sites like, offers technology solutions for business owners on a budget.

  9. avatarSandi Pantalon

    “Target –This popular store cut 400 open positions and 600 employees due to low sales.”

    Why does this make them one of THE WORST companies to work for?

  10. avatarunemployed1

    Not a particularly profound article. Let’s get real. We all know the new finance math for corporations. It’s taught at all college MBA programs. You can cling to your notions of merit and loyalty but, the sad truth is jobs and people are viewed as ‘commodities’, just like the boxes sitting back on warehouse shelves. There’s only one solution for minimizing the risk and uncertainty of sudden job loss…. that is, keep your resume fresh and be ever on the lookout for a new place to perch. This is not an action of paranoia or retribution. It’s self preservation. This is what corporations are inadvertently encouraging people to do. Don’t butt your head against it, pick and roll.

  11. avatarUnitedStatesofAmnesia

    There is one company missing from this and other lists that is a glaring omission. Securitas Security Services, Inc is the absolute worst company to work for and is the world’s largest security corporation. Here in the U.S., they bought out Pinkerton and Burns Security to expand their already global footprint. They boast of having a lot of former military employees, but show their appreciation by paying substandard wages ($8-$10/hr) in most instances and having almost no benefits. The only health insurance they offer is expensive and offers no major medical coverage. Most of their employees qualify for federally-subsidized low income healthcare coverage. They have no pension and the 401k they offer has matching funds of only 1/2%. They have no paid holidays off and only offer time and a half if you work one of their few listed holidays. At most sites, they have no new hire training period. They tell you the basics in a couple of hours, then the rest is all “on the job” training. They have recently introduced a “floating payscale” at many sites. Basically, if you work overtime for someone who has called off work, you get paid at 1 1/2 times that persons pay rate, not your own pay rate, for anything over 40 hours. This “floating” of your pay rate only happens if the pay goes down. It never works in your favor. If you work for someone who gets paid more than you, you receive your own pay rate. If you work for someone who earns less than you, you get their pay rate. Securitas also offers no sick days or paid personal days and requires at least a 4-hour notice if you are going to be late or absent. If you don’t let them know at leat 4 hours in advance, it’s a job performance write-up for you!

  12. avatarAnonymous

    Earth Fare Market & Cafe, based in Asheville, NC (Fletcher), has become a Corporation that treats their employees like second class citizens. EF is giving away a fortune in product and money to customers to try to excel in customer service, while reducing employee pay raises and benefits. Employees are dropping like flies, tenure is expensive and replacable by cheaper new hires. HR focuses on the corporation’s protection and will create or lose information as needed to remove individuals and save on expenses. Integrity is not a strong characteristic of this company. Fairness and appreciation don’t seem to be in the mix either. Caution should be taken when considering this company. Gossip and favoritism is abundant, trust no one.

  13. Pingback: Business cutting cost

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