Timesizing® Associates - HOMEPAGE
Downsizings, June 3-16, 2003
[Commentary] ©2003 Phil Hyde, The Timesizing Wire, Box 117, Harvard Square, Cambridge MA 02238 USA (617) 623-8080
6/14/2003 2 downsizings, totaling 1,500 lost jobs, reported in Wall St Journal &/or NY Times
(not counting "White collar blues - How the middle class is coping with unemployment," by Carlene Hempel, 6/15/2003 Boston Globe Magazine, cover article, 10) -
6/13/2003 4 downsizings, totaling 3,615 lost jobs + unspecified, reported in Wall St Journal &/or NY Times
- France: Electronics job cuts, by Ariane Bernard, NYT, B3.
The French electronics company Thomson lowered its profit forecast because of poor results at its TV-making operations in the U.S. and [will] cut more than 1,200 jobs in Marion IN and Circleville OH....
- Tenet Healthcare will cut 300 jobs in billing division, AP via NYT, B4.
...over the next 3 years as it streamlines its billing operations.... It [will] consolidate 56 business offices that handle billing and collection activities for its hospitals to 8 regional offices and one office to handle Medicare transactions. ...It [will] also spend $275m over the next 3 years to standardize its billing and collection technology and train employees. Tenet, based in Santa Barbara CA...expect[s] to save $75m annually from lower administrative and operating costs.
[This is the first we've heard from Tenet since they cut 1/8 of the staff at one of their hospitals on 3/19/2003 #3 without giving us a specific number.]
(not counting "Jobs are tepid...," by Rebello & Dooren, Dow Jones via WSJ, A2, which states, "The number of workers drawing unemployment benefits for more than a week surged by 120,000 to a 20-year high of 3.8m at the end of May.") -
6/12/2003 1 downsizing, totaling 130 lost jobs, reported in Wall St Journal &/or NY Times -
- Earnings estimates slashed due to storms, other costs, Dow Jones via WSJ, B5.
Delphi Corp. slashed its Q2 earnings estimate in half, citing weaker demand and production volume, as well as a recent [adverse] legal judgement. The Troy, Mich., autoparts manufacturer said production volumes [were reduced] below forecast level due to tornado-related production disruptions at GM's Oklahoma City facility. A $25m charge for a legal judgement in favor of a former supplier as well as costs to close Moraine OH operations and employee separation packages also hurt the company's [bottom line].
As a result, Delphi expects to cut 3,900 jobs in 2003, compared with 6,100 last year [caught on 4/18/2002 #1]. Current employment totals about 189,000 people. The company also plans to defer noncritical selling, general and administrative costs and capital expenditures, as well as limiting hiring and continuing attrition to reduce its workforce....
[We also caught 750 cuts planned for 2003 on 12/13/2002 #1, which should probably be deducted from the 2003 total above of 3900, parallel to the way we deducted the 1400 Dec/01-announced '02 cuts (12/11/2001 #3) from the 2002 total on 4/18/2002 #1. So we now count 3900-750= 3,150 jobcuts, which are 3150/189000= 1.7% of the total workforce and should be handled by merely cutting 1.7% of the corporate workweek, not the workforce - and consumer base.]
- 3Com will cut jobs, Reuters via NYT, C4.
The network equipment maker [will] eliminate 10% of its workforce, or about 390 jobs, over the next 2 quarters to reduce costs amid weak demand. ...Most of the reductions [will] affect employees in the U.S. and Europe. Within the U.S., the cuts will be felt most at the company's HQ in Santa Clara CA.
- Weyerhaeuser, NYT, C4.
...Federal Way, Wash., the lumber company, [will] cut 75 jobs when a fine-paper machine at a plant in Rothschild, Wis., is shut down later this year.
- Suppliers will have to apply radio-ID tags to shipments, Dow Jones via WSJ, B5.
Wal-Mart Stores Inc., Bentonville, Ark...is requiring its 100 biggest suppliers to apply radio-frequency identification tags to their pallet shipments by 2005, giving a big boost to a nascent technology that promises to take time and costs out of the supply chain.
[Bet Japan has been doing this for years, radiotag kanban.]
Linda Dillman, Wal-Mart's CIO, made the announcement Tuesday at the Retail Systems 2003 Show in Chicago, saying the system will allow for faster shipping and receiving of merchandise. Unlike bar codes, which must be scanned by hand, auto-ID tags emit radio-frequency waves that are picked up by warehouse scanners, which feed the inventory data to a computer system. The process cuts labor costs, human error and theft.
[Unspecified job cuts. And more evidence against the 18th-century thinking that chants, "Technology creates more jobs than it destroys!"]
The chips that power the tags - also known as smart tags - eventually are expected to be attached to all products, to speed checkout, among other things. The technology has been refined for several years at MIT's Auto-ID Center, which is supported by 100 companies, from retailers to consumer-product makers.
[And of course there is absolutely no problem with technology taking over human work if industry leaders respond by cutting worktime per person, but if they instead cut persons out of the workforce, they also cut consumers out of the consumer base, they create weak markets for themselves downstream. Additionally, they create a larger pool of un- and under-employed people willing and desperate to do your job for less, thus restraining your pay raises and depressing their own pay if and when they get a new job. This further weakens consumer markets even based on those still employed. And a string of social costs begins when those still employed see wave after wave of layoffs and begin to fear being the first to leave the office at night, so working hours lengthen, work concentrates on fewer people, and families get neglected. Technology's promise, to make life easier for everyone, has been frustrated and subverted into making life worse for everyone, including the top-income brackets who become evermore insecure, alienated and isolated in their gated communities. The alternative is a modern economic design that makes overtime trigger and resolve its own inherent bottleneck of skills and personnel, and makes the workweek vary inversely and automatically with un- and under-employment - as long as unemployment, comprehensively defined, is too high or rising, the workweek slowly and homeostatically adjusts downward, to spread the vanishing human work evenly across the entire consumer base and stabilize consumption instead of allowing it to imperceptibly, but cumulatively, to shrink. And of course, the "money-back guarantee" is that workweek movement is bidirectional - if unemployment, comprehensively defined, goes too low too fast (all defined by regular public referendums), then the workweek automatically relengthens until technological work-shouldering reverses the process.]
6/11/2003 4 downsizings, totaling 3,050 lost jobs, reported in Wall St Journal &/or NY Times
- Cymer cuts 2nd-quarter sales forecast, Bloomberg via NYT, C6.
...Make[r of] lasers that imprint computer chip designs on silicon wafers...has pared its product line and reduced spending on plants to lower the amount of sales needed to turn a profit. The company cut 130 jobs, a 15% reduction in April after Q1 sales missed its forecast. Cymer had net losses in the last 2 quarters...the CFO, Nancy Baker, said in an interview. No additional cuts in the [adjusted] workforce of 720 are planned, she said....
(not counting "New[??] recipe for cost savings: Replace expensive workers - In a tight [employment] market, employers are finding job seekers willing to accept less [no kidding!]," by Carlos Tejada & Gary McWilliams, WSJ, front page) -
6/10/2003 3 downsizings, totaling 408 lost jobs + unspecified, reported in Wall St Journal &/or NY Times
(not counting "Would-be entrepreneurs learn from the search - Firings, sluggish economy bring more to the hunt...," by Jeff Bailey, WSJ, B5, which starts, "The wilderness is full of former corporate types wandering around trying to turn themselves into entrepreneurs. Some got fired or downsized.... And for too many, in this nasty economy, the wandering won't end anytime soon.") -
- Texas Instruments lowers forecasts, Bloomberg via NYT, C5.
...The world's largest maker of cellular phone chips...will cut 250 jobs in Japan [just what Japan needs], in addition to the 1,250 workers the company said in April [missed it!] that it would lay off....
[So now we count 250+1250= 1,500 layoffs.]
- Safeway to reduce administrative staff by 13%, Bloomberg via NYT, C4.
...to lower costs. About 252 of the 940 jobs being cut were open and will not be filled.... More than 400 employees were laid off yesterday, while the remaining will be terminated over the next year.... The loss of customers to discounters had led Safeway, based in Pleasanton CA, to try to lower employee expenses [which, of course, lowers general consumer buying power!]....
- Sprint Corp., Dow Jones via WSJ, A9.
...will close its webhosting business, cutting nearly 500 jobs [say 499?].... The Overland Park, Kan., telecom concern said the move will result..\..in pretax charges of $400-475m...to its FON Group results. Sprint is composed of 2 separately listed units -
Nearly $300m of the charges [are] related to the impairment of hosting assets [and] will be recorded in Q2. The rest are related to the winding down of the business [and] will be recognized in future quarters....
- FON Group, made up of Sprint's phone and Internet business;
- and PCS Group, the company's wireless operation.
- Drug developer to cut staff 13%, renegotiate lease obligation, WSJ, B5A.
Vertex Pharmaceuticals Inc...plans to eliminate 111 employees at its Cambridge MA and San Diego sites \to gain\ the flexibility to focus on moving [ie: to speed?] its drug candidates from clinical development to commercialization....
[Dropping staff is going to speed bringing drugs to market? Their degree of cirumlocution bodes ill.]
The move will leave about 737 workers at the company. Vertex also plans to minimize its financial obligation on a lease to a new Kendall Sq research and office facility in Cambridge, which the company signed on Jan/2001....
6/07/2003 1 downsizing, totaling 50 lost jobs, reported in Wall St Journal &/or NY Times -
- Some balk at moving with Philip Morris, Bloomberg via NYT, C8.
The Altria Group's Philip Morris USA unit said less than half of its HQ staff chose to join the unit when it moves to Richmond VA from New York. About 40% of the employees will move...by next June.... A majority of the 680 HQ workers, who had until last week to decide, will leave the company....
[So this move amounts to a 60% downsizing or at least, wage&market-trimming workforce churn, and 60% of 680 is 408 layoff-equivalents.]
Altria...expect[s] to save about $60m a year through the...move [which] will end more than 100 years of association between the business and New York....
[How so? - when...]
Altria will continue to be based in New York \and\ Altria [was] formerly known as the Philip Morris Cos....
- Anadarko buys 26 oil fields; Deal will result in job losses, Dow Jones via WSJ, A12.
Amerada Hess Corp. sold...fields in the Gulf of Mexico to Anadarko Petroleum Corp., a move that will lead it to cut about 30% of its exploration and production jobs.... The number of jobcuts wasn't disclosed....
[And Dow Jones/WSJ can't look up the headcount for us? Pathetic. Undisclosed jobcuts.]
- IPO.com website closes, Bloomberg via NYT, C8.
...A website that tracked equity sales for 6 years has closed, a statement on the website said without giving any reason for the closing....
[Unspecified jobs lost.]
David Roberts, a co-founder and CEO of IPO.com, said that the website was "ceasing publication" in a message posted there dated June 6.... There have been 5 IPOs [initial public offerings of stock] in 2003, and they have raised $593m.
6/6/2003 2 downsizings, totaling 800 lost jobs, reported in Wall St Journal &/or NY Times
- Animation workers in Florida face layoff in bid to cut costs, Dow Jones via WSJ, A12.
Walt Disney Co...will lay off about 50 employees at its animation studio in Orlando FL...as [it] continues to seek ways to reduce the high cost of its animated movies.... The Burbank CA company currently has about 1,100 animation employees in California and Florida.
[making this a 50/1100= 4½% downsizing]
..\..Rather than keep most of its animation staff on long-term contracts, the entertainment concern is moving toward a system in which many workers are hired for a specific production, then let go at its completion.
[It's an indication of our labor surplus that there are enough underemployed animators for Disney to do this.]
Disney feature animation chief David Stainton said the cutbacks are necessary because a film to be made at the Florida studio, "My Peoples," will require a smaller staff than previously thought....
[Probably because more of it can be done by computer.]
(not counting "Claims for jobless benefits rise," pointer digest (to C6), NYT, C1, which says, "The Labor Dept. reported that the number of American workers filing new claims for jobless benefits climbed to a 5-week high last week," pointing to, "Requests for jobless benefits increase - 'The labor market obviously is still contracting,' an economist says," AP via NYT, C6.) -
6/05/2003 5 downsizings, totaling 2,758 lost jobs + unspecified, reported in Wall St Journal &/or NY Times
(not counting "Planned job cuts declined in May, survey says," Bloomberg via NYT, C8, which states, "Employers in the US announced plans in May to cut 68,623 jobs, the smallest number of intended layoffs in 30 months and a sign that the worst round of job losses may be over, [according to] Challenger Gray & Christmas [don't bet on it till they find another way of responding to technology, say, timesizing]..\.. Planned jobcuts were down 53.1% from the 146,399 announced in April and down 19.2% from the 84,978 announced in May 2002 [there's a warning sign right there: this April was up 72% from a-year-ago May! you gotta be really straining for good news (or media coverage) to think the worst is over]. It was the fewest since November 2000, four months before the economy fell[??] into recession." - note tomorrow "Claims for jobless benefits rise" and Sat. "Jobless rate up to 6.1%, highest in 9 years" - so much for "worst is over." John Challenger, just give us the news and skip the cheerleading.) -
- Millennium Pharmaceuticals Inc., Dow Jones via WSJ, B8.
...seeking to become profitable by 2006, [will] cut 600 employees, or a quarter of its workforce, by the end of 2004 and phase out operations in San Francisco and the U.K. The Cambridge MA biotech company [will] concentrate its operations in its hometown. Its workforce [will] fall to 1,700 by the end of 2004 from 2,300 currently.
[So that's actually 600/2300= a 26% downsizing.]
...It [will] reduce its headcount mostly through reductions in early-stage research and in general and administrative functions.
- Swiss maker of luxury goods suffers from currency shifts, by Alison Langley, NYT, W1.
ZURICH...- On the same day the Swiss government reported that its export-dependent economy contracted in the first quarter, Compagnie Financier Richemont provided the proof. The company, parent to luxury-goods brands like Cartier and Piaget watches and Montblanc pens, said [yester]day that its operating income in the fiscal year ended March 31 fell by nearly half from the year before, on sales that fell [only] 5%.
The main culprit was...unfavorable currency shifts.... Johann Rupert, chairman of Richemont, said that demand for its goods was slack because of sluggish economic growth and sour stock markets around the world. Middle East tensions and fears of terrorism and the SARS virus had also kept many travelers at home and away from duty-free shops.... To cut costs, Mr. Rupert has closed a Cartier watch plant in Switzerland, laying off 200 workers....
6/04/2003 3 downsizings, totaling 535 lost jobs + unspecified, reported in Wall St Journal &/or NY Times -
- Cable & Wireless to withdraw from U.S. market, trim jobs, by David Pringle, WSJ, B2.
LONDON - Struggling telephone company...reported an even bigger loss than a year earlier and announced it would...cut 1,500 jobs in its U.K. business....
[and from the NYT version -]
Cable & Wireless [C&W] posts loss and plans to pull out of U.S., by Heather Timmons, NYT, W1.
...C&W has announced more than 15,000 layoffs since March 2000.... "He [new CEO Francesco Caio] is really changing the strategy from global to national," so the company can benefit from economies of scale, said Mike Williams, a WestLB telecoms analyst....
The company employs 2,774 people in America through its purchase of MCI's Internet backbone, Exodus Communications, and Digital Island.
[So what's going to happen to them? And it don't help us with the % cut in the UK.]
...Shutting its American operations could prove costly. C&W could incur restructuring charges of...£500m.... A sale would be preferable, but an obvious buyer has not emerged....
- Britain: Cuts at china maker, by Heather Timmons, NYT, W1.
The maker of crystal and tableware Waterford Wedgwood [will] cut more than 10% of is British workforce and move production of earthenware out of Britain to cut costs.
[Whaaat?! They're moving WEDGWOOD out of England?! Maybe not -]
Manufacturing of Johnson Brothers, a line of moderately priced tableware, is being relocated to Asia. Johnson, founded in 1883, was bought by Wedgwood in 1968. The move will eliminate 1,058 jobs and close two factories in England....
[Here's the Journal voursion/Jernal version -]
Crystal maker posts a profit, will close 2 UK plants, Dow Jones via WSJ, A8.
...The Irish china and crystal maker...was hurt last year by the global economic slowdown in the aftermath of 9/11/01 and subsequent heavy restructuring charges.
[Irish?! Maybe the Waterford crystal but sure as hell not the Wedgwood china!]
It has moved back into the black primarily on its restructuring plan.
[So it's using "restructuring" both as an excuse for its hurts and a reason for its recovery?!]
...To cut costs further it will relocate its Johnson Bros. earthenware mfg plant to Asia [and] outsource production from China, and 2 earthenware factories in the UK will be closed, leading to 1058 joblosses. Waterford's Wedgwood-branded earthenware will transfer to an existing factory in Barlaston, Stoke-on-Trent...which will preserve 275 jobs in England....
[We should hope so!]
- The Netherlands: Job cuts at Akzo Nobel, Bloomberg via NYT, W1.
...The largest chemical maker in [Holland] will cut about 200 positions as it tries to increase the efficiency of its surface-chemistry business, which sells additives for detergents, farm products and paints. The unit, which has about 2,200 employees, will cut 120 of its North American workers, most of them in production. About 80 mostly administrative, sales and research jobs will be eliminated in Europe.... Akzo, based in Arnhem, is cutting jobs as the additive market becomes more competitive.
[So, 200/2200= 9% of the unit's total workforce.]
- Pathmark Stores Inc., Dow Jones via WSJ, A8.
...Fiscal Q1 earnings plunged 57%, partly due to charges related to jobcuts.
[Here they want to justify jobcuts by lower earnings and then turn around and blame them for even lower earnings. What a pack of incompetents. Unspecified jobcuts.]
The Carteret NJ grocery-store operator reported net income...of $900k...compared with $2.1m...a year earlier.
[And these engineers of their own shrunken markets were in profit back then anyway.]
The latest results included an expense of $3m for a labor-buyout program in some stores and head-count reductions at the company's corporate office, while the year-earlier quarter included a $1.2m charge for a similar buyout program and costs of $600k for an accounting adjustment.
[So they were also fiddling the books. Pathetic.]
- Online casino to be shuttered; Related loss will be recorded, Dow Jones via WSJ, A8.
MGM Mirage will shut down its online casino June 30 and plans to record a related $5m loss on discontinued operations for this year's Q2.... MGM Mirage Online is based in the Isle of Man [UK]....
6/03/2003 1 downsizing, totaling 4666 lost jobs, reported in Wall St Journal &/or NY Times (not counting "Anger rises over job exports," pointer blurb (to A4), WSJ, front page, which states, "One forecast has several million U.S. jobs moving offshore, especially to India, in the next 12 years," and also, "The Iraqi jobless - U.S. administrator seeks to restore a broken economy," by Edmund Andrews, NYT, A13, "broken" by the neo-con artists of the Bush administration) -
- Three plants will be closed, displacing about 480 workers, Dow Jones via WSJ, D4.
La-Z-Boy Inc...of Monroe MI [which] employs about 18,000 workers companywide..\..will close 3 mfg plants in Morristown TN and Monroe NC that produce wood furniture, called casegoods...after its Q4 sales fell on declining demand. ...Its casegoods business...reported a 14% sales drop from a year earlier for both the quarter and full year. Casegoods industrywide have been hit hard by a flood of imports in recent years.
[So, 480/18000 gives us a 2.7% downsizing.]
- PipeVine closes, leaving charities short of funds, by David Bank, WSJ, C13.
...A major processor of charitable contributions abruptly ceased operations this week...because of "a severe liquidity crisis"..\..leaving donors and recipients in the dark about the status of millions of dollars in donations..\.. Pipevine Inc...a nonprofit based in San Francisco...was spun off from United Way of the Bay Area 3 years ago..\..processed charitable contributions for corporations, nonprofits and online fund-raisers.... United Way [was its] biggest customer..\..
[And what exactly is "processing"? - running thru MasterCard or Visa and taking a percentage? How the heck could such a simple operation have "a severe liquidity crisis"?]
...Its website [says] it has distributed more than $700m to 50,000 organizations in the past decade.
["Distributed" sounds a lot more than running thru MasterCard or Visa - or it could just be website hype.]
...PipeVine Pres. Frank Melcher, reached at his home last night, would only read from a prepared statement, saying the company has told the attorney general that it "has a negative fund balance that will result in a shortfall to some charitable organizations."
[Aha, so these sleezebags were "playing the float" and speculating, possibly in mutual funds, with the donations they were receiving. This kind of "Processing" of charitable donations has a lot more risk than just processing them - EVERYbody's gotta push the envelope and get a racket.]
Mr. Melcher said PipeVine's auditors and an outside consulting firm had found no evidence of theft, embezzlement or defalcation.
[That would only be true if, in the large print of PipeVine's contract with them, the client charities had authorized PipeVine to "invest" their donations.]
He said PipeVine had laid off its 55 employees Monday.
Charitable organizations said they hadn't received distributions from PipeVine in several months. PipeVine's failure is another blow to a nonprofit sector reeling from government cutbacks, shrinking endowments and management scandals that some fear are eroding trust in charities....
[Our pathetic excuse for an economic design careens on - our "skimming and charity system." And any system that relies on charity for critical functions - as we do just for centrifugation (& activation!) of spending power now that this high-tech nation's workforce is largely redundant and the power gradient between the top brackets and ordinary people is nearly vertical - is lethally flawed.]
Losses mount after collapse of charity firm, by Stephanie Strom, 7/03/2003 NYT, A17.
- [and one specific example of the lethal ripple effect -]
PipeVine closes, leaving charities short of funds, by David Bank, WSJ, C13.
...One organization that said it is due money is the Korean War Project [KWP], an information clearinghouse based in Dallas. Hal Barker, a founder, said PipeVine stopped giving it funds in mid-March. He estimated the group is owed about $1,300. "It's not a whole lot of money, but for us that is the difference between survival and collapse," he said.
[R.I.P., KWP. Unspecified lost jobs (though possibly Hal was the only one in the "group").]
- FedEx plans early-retirement, severance deals to cut more costs, by Betsy McKay, WSJ, A10.
...in its core express-delivery division.... It is implementing voluntary...programs for which 14,000 of its U.S. employees are eligible.... About 12% of the 116,000 employees of FedEx Express, the company's air-delivery unit, are eligible for either voluntary early retirement, or the severance package.... However, the company expects a much smaller number - perhaps fewer than one third - of the eligible employees to accept the offer, according to a person familiar with the plans....
[So this equates to a loss of 1/3 of 14,000 jobs = 4,666 jobcuts, which in turn is 4666/116000= a 4% downsizing - which could easily have been a less market-damaging 4% timesizing.]
Click here for downsizing stories in -
Earlier 2001 downsizings accessible via links at bottom of Dec.16-31/2001 page.
Earlier Y2000 downsizings accessible via links at bottom of Dec.16-31/2000 page.
Earlier 1999 months accessible via links at bottom of Dec/1999 page.
Earlier months accessible via links at bottom of Dec/98 page.
For more details, our laypersons' guide to our great economic future Timesizing, Not Downsizing is available at bookstores in Harvard Square, Cambridge, Mass. or from *Amazon.com online.
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