American Companies Cutting Costs
Posted by gbravo 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.