Downsizings in December/1999
[Commentary] ©1999 Phil Hyde, The Timesizing Wire, Box 117, Harvard Square, Cambridge MA 02238 USA (617) 623-8080
12/31/1999 2 pre-New Year's downsizings reported, totalling 3100 cuts -
12/30 4 holiday week downsizings reported, 679+?? cuts -
- Shareholders OK bailout of German builder, Bloomberg via Boston Globe, D4.
FRANKFURT - ...Konrad Hinrichs, appointed chief executive this month to get the company back on track after losses of 2.4B marks brought it close to bankruptcy, said that 3,000 job cuts, branch closures, and the sale of units will make the company profitable again....
[We noted this downsizing on 12/04 but jobcut figures were unspecified at that time. Too bad Holzmann isn't remembering how Volkswagen saved 30,000 jobs in 1994 - it cut its workweek from 35 to 28.8 hours and saved its HQ town of Wolfsburg at the same time.]
"Shareholders shouldn't be forced to carry the burden for crass mismanagement," said Klaus Nieding, a member of the DSW shareholder lobby group....
[Sure they should. They're the "owners." This clown probably wants employees or taxpayers to carry the burden. All gain, no pain - for speculators. Riiight.]
- Inspire Insurance Solutions Inc., NYT, C4.
[Surely an ill omen when a firm with these three words does a perfect-100 downsizing on the eve of a new millennium.
Some people have no soul - or class.]
...Fort Worth, which provides administration services for insurance policies and claims will cut its workforce by about 100 employees, effective today, as the company shifts its focus to business-process outsourcing and discontinues efforts to increase its licensed software packages.
12/29 3 holiday week downsizings reported, unspecified jobcuts -
- Value America plans to cut nearly half its work force, Bloomberg via NYT, C4.
...An Internet retailer of computers, office products and consumer goods said yesterday that its founders, Craig Winn and Rex Scatena, had resigned and that it would cut 47% of its work force. The company, based in Charlottesville, Va., has about 290 employees;...
[That's funny, because the Boston Globe version of this story today (p. D2), from the same newswire, says, "The retailer will fire 47% of its more than 600 workers," i.e., 290 layoffs. We're going to go with the Globe's figures here based on the ancient scribal principle of "legius difficilior potest" (the more difficult reading prevails) because we have no idea where the Globe would come up with a 600 if it wasn't in fact there, but the Times could have come up with the 290 because it's 47% of "more than 600 workers," specifically, of 617 workers. In short, we think the Times garbled this and took the number of layoffees as the (total) number of employees in the company. Meanwhile, we have one question for those of you who are much impressed with data in print - Still trust the media? The Globe and the Times have the same owners and they got this info from the same story from the same newswire, yet one of them totally screwed up the numbers.]
...It said it would take a $5.6m 4th-quarter restructuring charge [and that] 4th-quarter sales would be 6-9% below estimates because of problems that arose from a new computer network.
["Physician, heal thyself."]
- Century Business Services Inc., NYT, C4.
...Cleveland, a provider of insurance, accounting and other services, plans to cut more than 200 jobs as it consolidates several operations and sells four smaller units to lower costs.
- Chesapeake [Corp.] to take tax charge and to cut work force, Reuters via NYT, C4.
...A specialty packaging maker said yesterday that it would cut about 5% of its work force and take a 4th-quarter charge as part of a restructuring program.... Richmond, Va.[-based] Chesapeake said the restructuring...would close a Mechanicsburg, Pa., assembly plant employing 135 people and reduce staffing at other operations [by how much???]....
- Aerovox to cut 54 jobs, take $5.5-6m charge, Bloomberg via Boston Globe, C4.
...A maker of film and paper capacitors said it will fire...4% of its work force [and] take a pretax charge...to close plants in Juarez, Mexico and Weymouth, England. The company will cut about 350,000 square feet of its manufacturing capacity with the closures. About $5m of the charge will be for the impairment of obsolete assets, and $700,000 will go toward payments to fired employees. New Bedford, [Mass.]-based Aerovox had 1,428 employees as of Feb. 27....
12/28/99 Equistar [Chemicals] to cut back operations and take tax charge, Bloomberg via NYT, C3.
- Jostens, maker of class rings, agrees to buyout, Bloomberg via NYT, C7.
...Jostens, which is based in Minneapolis, said it would cut about 1.5% [100 jobcuts] of its 6,500 workers, including its chief operating officer....
- [The takeover-downsizing connection lives -]
Sipex to eliminate jobs after buying Calogic, Bloomberg via Boston Globe, C7.
...An integrated circuit maker said it will cut jobs, close its Fremont, Calif. operations and reorganize its work force as a result of its $45m purchase of Calogic Corp. Sipex will move Calogic's analog circuit operations to facilities in Milpitas, Calif. from Fremont. The Billerica, Mass.-based company, which bought Calogic in November, didn't say how many jobs will be cut. Sipex will take $3.5m in Q4 charges, including $1.9m for severance costs.... Sipex's shares fell....
[Good, maybe the stock market will start rewarding its own sustainability for a change, instead of its own suicide.]
- Saks Inc., NYT, C3.
...Birmingham, Ala., a department store operator, said it would close two "Younkers" stores in Milwaukee and a "Boston" store in Green Bay, Wis., to focus on other properties in the area.
[And 3 store closings mean layoffs, but since they're "nice" enough to announce in the holiday season, they're not specifying how many casualties they're going to cause.]
...North America's largest producer of polyethylene said it would take a pretax charge of $95m in the 4th quarter to close some production lines.... at its plant in La Porte, Tex., and cut as many as 180 jobs to reduce costs.
12/24 Tultex lays off 1,100 workers, by Kia Breaux, AP 1307EST via AOLNews@aol.com, fwdd by RadioTony.
[This story overlaps numbers with our story below on 12/04, so we won't count them again, but it puts a rare human face on the numbers.]
MARTINSVILLE, Va. - This is a less-than-joyous holiday season for Gordon and Nicole Crawford.
The Rocky Mount, Va., couple were among 1,100 Martinsville-area workers laid off this month from their jobs at fleecewear maker Tultex Corp. With two jobless people in the same household, there will be little money for sharing gifts with family and friends.
"It would have been nice if they could've waited until the first of the year,'' said Mrs. Crawford, 25, a five-year knitter at Tultex, which filed for Bankruptcy Court protection from its creditors on Dec. 2. ``Talk about a grinch stealing Christmas.''
The Crawfords' sentiments are echoed throughout the close-knit community surrounding Martinsville - an area that has lost 2,600 jobs and a payroll of $50.6 million since September. About 340 jobs were created all year.
"We are in an economic crisis,'' said Paula M. Burnette, a member of the Henry County Board of Supervisors. "We have more than 2,000 people walking the streets looking for work.''
The Tultex layoffs culminated another bad year in the U.S. textiles industry, which has lost 144,000 jobs, or 21 percent of its work force, since 1990, said Gary Shoesmith, an economist with Wake Forest University. Roughly 117,000 of those jobs, or 22 percent, were eliminated in the Southeast alone. In Virginia, 11,700 workers, or 28 percent, lost textile jobs over the past decade.
"And there's no end in sight,'' Shoesmith said.
Kim Adkins, a spokeswoman for Tultex, said an increase in imports from Asia and unseasonably warm weather decreased the demand for fleece products, accounting for much of the company's financial woes. Tultex posted a $35.4 million loss in the third quarter - almost as much as its $36.5 million loss for all of 1998.
Many people blame the North American Free Trade Agreement for the industry's troubles, as more work is being shifted to foreign countries where wages are cheaper and environmental regulations are more lax. But Shoesmith said technology is just as much to blame.
"The industry has become highly automated,'' he said. "Human hands rarely come in contact with material any more.''
[So much for The Economist et al. who sneer at the "Lump of Labor Fallacy", and expect us to believe that "technology creates more jobs than it destroys." If it did, no one would be introducing it.]
That harsh reality is hard for workers like Erma Adkins to swallow. At 53, she's worked for Tultex more than half her life.
"I have no real skills. I don't have a high school diploma, just a ninth-grade education,'' she said. "What do I look like at my age, going out to hunt a new job or even going back to school?''
Erma Adkins, no relation to Kim Adkins, was one of a handful of maintenance workers called back on Dec. 13 to help the company through a transition period. An additional 450 layoffs are expected by February.
The filing under Chapter 11 of the U.S. Bankruptcy Code was the company's last resort, Kim Adkins said.
Under Chapter 11, a company tries to reorganize its finances under a court's protection and supervision in an attempt to stay in business.
"The timing is very unfortunate, It's just how the sequence of events happened,'' she said. "If there was any way to say, 'We'd prefer to do this three months from now,' we would have.''
About 200 frustrated Tultex workers have met with U.S. Labor Department officials to find out what resources are available to them. Because Tultex was self-insured, families like the Crawfords, who have a 3-month-old baby, were left without company-paid health insurance. Premiums for dislocated workers' insurance can absorb most of the maximum $230 per week in unemployment benefits.
The former Tultex workers are eligible for federal Trade Act funds, which are set aside for benefits and reemployment services to workers who have lost jobs to foreign competition.
The Henry County Board of Supervisors stepped in and declared an economic emergency, clearing the way for interest-free loans and tax breaks.
Gov. Jim Gilmore asked U.S. Labor Secretary Alexis Herman for $2 million to help the displaced workers.
The local Salvation Army opened a toy store where laid off workers can pick out toys for their children.
At least one local toy store reported brisk returns of toys after the Tultex layoffs were announced.
"Here lately it's been refund after refund after refund,'' said Myron McCambridge, an assistant manager at Kay-Bee Toys at Liberty Fair Mall in Martinsville. "They don't come right out and say they were one of the workers laid off, but you can see it in their eyes.''
Shoesmith said the impact is always greater on smaller communities.
"When a plant closes within a metropolitan area, it's unfortunate, but hardly a disaster,'' Shoesmith said. "When it hits smaller areas it seems personal because the impact is so strong. But it's not personal; it's business and it's the future.''
[If this is the future, then the future is the Great Depression II.]
12/23 23 laid off last week in Calif., fwdd by 'Whosewoods', no newswire cited.
Laid off last week: about 23 people [at] Leybold Materials Inc..\..a smallish hardware manufacturer in Gilroy, CA.... One man was only 2 months away from vesting in retirement.
[Shades of the Drew Carey Show episode aired tonight at 6:30 pm on Channel 25 in the Boston area, in which Drew was given the task, by a new British manager, of laying off a longtime (35 yr?) employee who was one day away from vesting. Drew kept putting it off and finally refused.]
...The president was fired; other executives had resigned, including the HR director, who is being replaced by the secretary.
[Oh that should save money.]
The company's European holding company, Oelikon-Bührle Holding AG, is in the process of instituting a new model for its manufacturing system.
[With employee relations like this, it ain't gonna survive long enough to don the 'new model.']
12/21 3 Xmas-week downsizings reported, totaling 9000 + unspecified jobs -
12/18/1999 3 downsizings reported, totaling 1230 jobs -
- [Again the merger-layoff sluice, and...right before Xmas??!]
Honeywell expects to lay off 8,000 [i.e., 3500 (2.9%) additional], AP via AOLNews@aol.com, fwdd by RadioTony.
...worldwide next year, 3,500 more than it announced shortly after the Honeywell-AlliedSignal Inc. merger. "As with any merger, the more time you spend looking at the synergies across the company, the more opportunities you find,'' Honeywell spokesman Tom Crane said today.
[Yeah and as long as we regard chances to chop our consumer base as "opportunities," we 're suicidal.]
The layoffs are to be completed by the end of 2000. Notices were sent over a week ago to all employees in the businesses that could be affected, he said. The new layoff figure was disclosed Monday during a meeting with industry analysts.... Honeywell had said shortly after completing the Dec. 1 merger it would be laying off 4,500 people - 3.6% [ah, we get 3.75%, anybody check this story?] of its combined work force of 120,000 - as the two companies became fully integrated.
Honeywell, which had been based in Minneapolis, is the No. 1 maker of automated controls for the aerospace, automotive, pharmaceuticals, fibers and plastics industries. AlliedSignal made aviation equipment ranging from aircraft engines and collision early-warning systems to wheels and brakes. The merged company, known as Honeywell, is now based at AlliedSignal's headquarters in Morris Township.
Some 80 percent of the 8,000 layoffs are related to the merger, while the remainder are due to "repositioning and restructurings,'' primarily in the materials businesses of the former AlliedSignal, Crane said. He said the company did not have a figure on how much money the layoffs would save.
[Ah too bad. Betcha all the employees are checking how much money they've got saved - in the bank - just in case of it's them - and that's taking priority in their lives, not producing for Honeywell.]
The overall merger, however, is expected to save $250 million in first year, and $750 million by 2002, he said.
[As we say, mergers are just appetizers for more downsizing - of our whole future. And here's another one -]
Also Monday, the electronics and avionics giant announced it planned to acquire burglar- and fire-alarm maker Pittway Corp. of Chicago for $2.2 billion. Buying Pittway gives Honeywell a centerpiece for its $3.4 billion home and building control unit and will make it a "global player'' in the competition for a greater share of the $10 billion fire and security market, the company said.
[Keep this up, CEO community, and we'll find out what great "global players" you'll be without a consumer base.]
- Dana reaffirms its plan to lay off 1,000, Reuters via NYT, C6.
...A major supplier of automobile components said yesterday that it would proceed with plans to lay off more than 1,000 workers, or about 1.2% of its work force.... The jobs cuts...were part of a restructuring move aimed at improving competitiveness by increasing operating efficiencies. "By eliminating excess capacity created by market shifts and by utilizing our assets more efficiently, we position Dana better for the future," Dana's president and chief executive, Joe Magliochetti, said in a statement....
[Joe, you get our booby prize for a Xmas Week layoff announcement.]
A Dana spokesman, Gary Corrigan, said the company would complete the previously announced job cuts by June.
[Sorry, Dana, we watch pretty closely but the only previous announcement we saw was on 10/19 when you said you were closing 14 plants and 29 warehouses, no jobcuts specified.]
He said Dana would cut about 700 of the 1,300 workers it employs at its Reading, Pa., plant that produces truck frames. Between 300 and 400 workers at "numerous" smaller plants in South America and Europe also will be affected, Corrigan said, adding that the sale of certain businesses and a lost contract at the Reading plant necessitated the cuts.
[Job cuts are NEVER necessary except in corporate extremis immediately prior to complete shutdown. They can ALWAYS be avoided by hours cuts and job reassignments that keep everyone employed and earning and spending as normally as possible. Downsizing is an idiotic short-sighted excuse for a strategy comparable to clear-cutting our forests or drag-netting our once-rich ocean-floor fisheries, such as George's Bank. It will be illegal in the future. We give it another 200 years at most, before our stupid "intelligent species" wakes up to its death-spiral effects. Firing for cause on an individual basis will not be affected, but group downsizing will be history, and good riddance!]
- Three weddings and a funeral...a small specialty agency closes shop, by Stuart Elliott, NYT, C8.
...The [advertising] agency that is closing, effective immediately, is Mulryan/Nash, a small New York shop specializing in campaigns aimed at gay and lesbian consumers.... Dave Mulryan, president... wrote that "harsh financial circumstances beyond our control" led to the closing....
[No employment figures specified.]
12/17 2 more downsizings reported, totaling 925 jobs -
- Dun & Bradstreet unit is planning to cut 700 jobs [5.6%], Reuters via NYT, B3.
...in its Dun & Bradstreet Operating Co. unit [which has] lagged behind its sister unit, Moody's Investors Service, this year with smaller profits and decreasing revenues.... The company employs a total of 12,500 worldwide.
[These guys bored or something? They've got profits and revenues, haven't they? If they're going to notch down our consumer base anyway, everybody's profits and revenues are going to be just a little smaller again, including theirs. *Death spiral alert*]
- [Explicit takeover-layoff connection #1]
Goodrich moves to dismiss 24% of its work force, Bloomberg via NYT, B3.
...The No. 1 U.S. maker of airplane landing gear said yesterday that it would dismiss 500 workers...after its purchase of the aircraft-parts maker Coltec Industries. [This] represents the bulk of the job cuts associated with the Coltec purchase.... Goodrich will close a plant it owns in Seattle and close part of another in Euless, Tex., that was owned by Coltec. Goodrich, based in Charlotte, NC, expects to save about $35m annually, beginning in 2002, as it eliminates overlapping costs.
[Why not avoid the overlap by slipping the takeover in the first place?! Then you'd have a boodle of cash/credit and you wouldn't have to save $35m annually. But these boys are getting bored. What other explanation can there be for fixing something that isn't broken? Their boredom is going to ruin them.]
- [Explicit takeover-layoff connection #2]
Times Co. to cut 30 jobs [6%] at Worcester paper, by Chris Reidy, Boston Globe, C1.
Employees of the Worcester Telegram & Gazette [which employs about 500 people] learned yesterday that The New York Times Co. plans to reduce the newspaper's work force by 30 jobs through a voluntary separation program when it takes control of the paper next month.... Times Co., which also owns The Boston Globe, announced in Oct. its plan to buy the T&G for $295m from Chronicle Publishing Co. of San Francisco....
[OK kids - who wants to walk the plank? We need 30 "volunteers"! Ain't management sensitive and motivating? This is 30 murders that they're trying to make look like suicides. These 500 staffers are the folks who just went into overdrive the last 2 weeks to cover the death of the 6 courageous Worcester firefighters -]
In the past two weeks, the T&G staff mobilized to cover a fire that killed six Worcester firefighters, and the timing of yesterday's announcement, coming just before Christmas and after the fire, angered some in the newsroom, said chairwoman Kathleen A. Shaw of the T&G's unit of the Newspaper Guild. "A lot of people feel let down and disheartened," she said.
["Great job, kids, and merry Christmas - 30 of you are fired." Or as the Raytheon story had it yesterday, "Ho Ho Ho. And by the way, you're fired." But this is a voluntary separation program, says you. Oh yeah? Check this -]
T&G staffers who resign under the voluntary separation program may qualify for "extra considerations," said Catbert, the evil HR director [oh sorry] Peter Horstmann, the T&G's director of human resources, who declined to use the word "buyout" to describe the Times Co. offer. [Globe publisher Richard Gilman to whom T&G publisher Bruce Bennett will report] expressed the hope yesterday that 30 job cuts could be achieved through T&G staffers opting to take the voluntary separation package. "Involuntary reductions" would come "only as a last resort," he said..\..
[Who says it's the "discipline of the workforce" that's the big problem? The last 20 years as we've gone into serious but ever more strenuously denied labor surplus all over the world have proven that the real problem is the discipline of management. All this poor-management demoralization could be avoided by a tiny (6%) hours cut for all 500 staffers instead of a complete job loss for 30 of them. It's been avoided this way plenty of times before, like at Brockton Hospital in 1995 and American Optical before that.]
A review of the T&G's operations convinced Times Co. that the T&G can maintain its quality with a smaller staff, Gilman said yesterday;...
[Oh betcha that was a tough sell!]
...the decision to cut 30 jobs at the T&G "is being taken to streamline operations, increase efficiencies, and eliminate positions that are considered redundant."
Chris Pope, a leader in the Worcester unit of the Providence Newspaper Guild [union], said most T&G staffers were still studying the voluntary separation offer put forward by Times Co. "We're mulling it over," Pope said. "It's murky enough and not specific enough for most people."...
12/16 2 downsizings reported, totaling 2725 jobs -
- Layoffs at grounded airline, by Sam Dillon, NYT, C4.
Mexico's Taesa has dismissed 700 [23.3%] of its 3,000 employees. Authorities ordered the airline to suspend operations 3 weeks ago after the Nov. crash of a commuter plance west of Mexico City killed all 18 passengers and crew.
- Job cuts loom at Raytheon, by Tim McLaughlin, Boston Herald, 43.
Ho, Ho, Ho. And by the way, you're fired.
That could be the holiday message Raytheon Co. is sending to 200 maintenance employees, union officials said yesterday.
In a separate move, Raytheon this week fired about 25 union workers who made small electronic components in Andover, union officials said. The Lexington defense contractor plans to fire the maintenance workers in a move to cut costs in a maintenance department bloated with supervisors....
[Isn't it funny how the number of employees is just fine until they want to exercise this barbaric practice of NOT firing for cause, on an indiscriminate group basis, and then suddenly the workforce is "bloated".]
Raytheon has not made public its plans, but [Michael] Zagami [business mgr of Local 1505 of the IBEW] confirmed the company told him one third of the maintenance dept.'s 600 employees would be fired by February.
12/15 5 downsizings reported, totaling 2725 jobs -
- [Again, the lethal merger-layoff connection -]
Exxon Mobil expands plan to cut payroll - Will shed 16,000 jobs, 13% of its work force - The merged company says it can save $3.8 billion annually, by Robert Hershey, NYT, C1.
...in an effort to increase its cost savings to $3.8b/yr by 2002. The figure substantially raises the estimates given a year ago [12/09/98] by Exxon and Mobil when they first announced their plan to combine. At that time, the companies said the merged entity would cut 9,000 jobs and save $2.8 billion annually....
[Well our story from the Boston Globe has analysts predicting 20,000 layoffs, but since that was a prediction and not an announcement, we'll count 16,000 now.]
In all, 60% of the shrinkage is to come from the former Exxon and 40% from the former Mobil. Some 10,000 employees are to be discharged while 6,000 are expected to take "normal or accelerated" retirements, the company said.
[There's a word you don't hear outside a military context much on this side of the Atlantic - "discharged."]
Among the expected casualties are about 1,000 executives, or a third of the pre-merger Exxon and Mobil contingents. "This is clearly the most difficult aspect of implementing a merger as large as this one," Mr. [Lee] Raymond [the chairman] said of the loss of jobs.
[Then cut hours and not jobs!]
"We have plans in place to help cushion the impact on those who must separate."
[There's no "must" in this. It's purely a function of the barbarity and lack of imagination of our times, not only on the part of management but on the part of labor as well. Labor used to push "cut hours, not jobs" all the time. It was the major thrust of the AFL in the early 30s. But the only places where labor thinks of it now are smaller companies where the workforce is like a small town and everybody knows everybody. Check further down on our Case Studies page - Brockton Hospital and American Optical, for example.]
...The company also said yesterday that it planned to raise production by 4% next year....
[How long does top management think it can go on raising production and cutting the workforce? Who do they think buys this stuff anyway? What do they suppose they buy it with? "Pennies from heaven"? And yet it doesn't matter how many times economic history has proven that a "general glut" is possible by demonstration, or that Say's Law that markets always automatically clear, is Say's Fallacy, mainstream cheerleading economists pay no mind and forget competely that it ever happened as soon as a depression is over. Funny how the source of your paycheck can alter your scientific "objectivity," especially if we're talking about a social science (like economics).]
- Sierra Health Services Inc., NYT, C4.
...Las Vegas, a managed health-car company, cut more than 150 jobs, about 9.7% of its work force....
12/14 Back in the grim groove with 4 downsizings reported, totaling 2615 jobs -
- Inacom plans to cut 1,000 more jobs from work force, Bloomberg via NYT, C4.
...[A] distributor and operator of corporate computer systems plans to eliminate...about 10% of its work force, in...cost-cutting efforts, which include ending its federal government business. The company expects to save $100m/yr.
[Yeah, saving money by notching down your own and everyone else's consumer base. Brilliant.]
The moves follow cost-saving steps in the second quarter, when Inacom cut 1,000 jobs....
- [Explicit merger-downsizing connection -]
Sanwa to cut 1,000, Bloomberg via NYT, C4.
The brokerage affiliates of Sanwa Bank Ltd. - the Universal Securities Co., the Daii-Ichi Securities Co., the Taiheiyo Securities Co. and the Towa Securities Co. - said they would cut nearly 1,000 employees and [40 offices, i.e.,] almost a third of their branches after merging next April. The combined brokerage [to be called] Tsubasa Securities Co., will have about 3,700 employees [and] 128 branch offices....
[Let's see, 3700+1000 means a start-of-bloodshed workforce of 4700 and a cut of 1000/4700= 21%. Sayonara means goodbye in Japanese and sararimen means salarymen or employees.]
- Marketing research company to cut staff 10%, Bloomberg via NYT, C4.
Information Resources Inc., the [Chicago-based] marketing research company [which] sells systems that collect information from bar code scanners in stores and sells it to businesses..\..said yesterday that it planned to eliminate 325 jobs...as part of a series of moves to improve profits. The cuts, expected by the end of next year, will affect virtually all of the company's operations. [IRI] expects to save $15m/yr starting at the end of next year....
[Yet another team of management lemmings following the millions already chipping down their own consumer base.]
- Milacron to cut work force and close four plants, Bloomberg via NYT, C4.
...A Cincinnati-based company that designs and sells manufacturing technologies..\..plans to close 4 plants [Albion IND, Hillside NJ, Madison Hts MICH, Windsor ONT Canada], eliminating 300 jobs...3% of Milacron's work force. \It\ expects saving of 30-35¢/share in 2001 when the restructuring takes full effect....
- Metacreations Corp., Bloomberg via NYT, C4.
...Carpinteria, Calif., will sell its graphics software business, a move that will cut 100 jobs, almost half the software company's work force....
12/11 Learningsmith to shut stores - Heavy competition cited as Burlington firm files for Chapter 11; 2,350 will lose jobs, by Chris Reidy, Boston Globe, C1.
- AutoNation to close stores and cut [1800+225= 2025] jobs, by Keith Bradsher, NYT, C1.
DETROIT, Dec. 13 - In an admission of serious difficulties...the nation's largest seller of new and used cars..\..announced today that it was closing most of its used car superstores immediately and laying off their 1,800 employees, while taking a one-time charge against 4th-quarter earnings of $430-490m. [It] also said that it would suspend further purchases of new car dealerships and concentrate instead on reducing costs at existing dealerships. The company...had hired some of the brightest consultants in the auto industry at premium salaries [but now] has begun eliminating 225 of the 600 jobs at its corporate HQ in Ft. Lauderdale, Fla., and plans to cut pay and advertising at poorly performing dealerships.... The used car superstores \had\ high corporate overhead and losses [so] Q4 earnings will also fall.... To mollify Wall St. and auto dealers who sold their family businesses to the company for stock [what a Bad Move!] AutoNation also announced tonight that it would buy back another $500m of stock, in addition to the $1.2b...it had already repurchased....
- P. H. Glatfelter & Co., NYT, C4.
...York, Pa., a maker of paper used for writing, tea bags and cigarettes, many cut as many as 300 workers, or 7.8% of its work force.
- Cahners plans layoffs, by Ross Kerber, Boston Globe, C9.
...The specialty trade magazine publisher said it plans to lay off 150 employees, including about 30 from its big office in Newton [Mass.]. The layoffs are the latest step in a restructuring effort meant to free up more cash and "accelerate development of new Internet and print information products"....
[Here's hoping there's a market left for them by the time they get them developed.]
- Abrams Industries Inc., NYT, C4.
...Atlanta, a construction company and property owner, said it would shut its Abrams Fixture Corp. unit, which makes shelves, signs and checkout stands for supermarkets and dept. stores, and dismiss 140 workers, or about half its total work force of 300.
...The educational toys-and-games retail chain founded by local entrepreneur Marshall Smith said yesterday it plans to close all 87 of its stores by mid-January and go out of business.... Learningsmith, which counted public TV station WGBH as an early investor, employs about 850 full-time workers and 1,500 part-timers, said Harold B. Murphy of Hanify & King, the Boston law firm that represents Learningsmith. "We are putting in place a severance package," he said.... Most of the company's senior executives, including chief executive Janet Emerson, have "departed" already, he said....
12/09 3 downsizings reported, totaling 1210 jobs + unspecified -
12/08 4 more downsizings reported, totaling 3650 jobs + unspecified -
- 500 workers to be dismissed as AGCO closes 2 factories, Bloomberg via NYT, C4.
...The 3rd-largest U.S. farm-equipment maker said yesterday that it would dismiss about...5% of its work force...because of reduced demand for tractors and other agricultural implements. The company, which makes Allis and Massey Ferguson tractors [will close factories in] Coldwater, Ohio and Lockney, Tex....
[Sounds like the agricultural sector is really in trouble - just like the late 1920s.]
- Tufts Health to eliminate 430 jobs [16%] - Ailing company looks to save $30m next year, by Steven Wilmsen, Boston Globe, D1.
...in a massive retrenchment...as [the HMO] struggles to regain its financial footing. [Massachusetts'] number two health plan has been reeling from spiraling medical and pharmacy costs and a misguided mid-'90s expansion that never produced profits.
Just weeks ago Tufts said it had decided to pull out of R.I., Me., and N.H.... About 90 of the layoffs announced yesterday will come from...outside of Mass. In Mass., an additional 180...will lose their jobs immediately and 30 more will go gradually through attrition. Tufts also said it would permanently eliminate 131 positions that are currently vacant.... The cuts came in virtually every department and included senior excutive and management positions.... Health plan officials avoided eliminating positions that would affect customer service. All laid-off employees will receive severance packages, outplacement assistance, and, in some cases, opportunities to apply for other positions within the company.
...[This] is just the latest in a series of recent cutbacks and reorganizations at the state's battered health plans. Harvard Pilgrim Health Care...the state's largest HMO..\..has eliminated 245 positions since July.... Earlier this fall, it announced plans to pull out of R.I., where its operations were put in receivership.... Most of Mass.'s major health plans, including Harvard Pilgrim and Tufts, have announced major premium increases and reduced drug benefits to stanch financial bleeding.
Tufts, like other Mass. plans, underwent a massive expansion in the mid-1990s, venturing into other New England states and growing its member base from just 358,000 at the end of 1994 to 1.1 million currently. At the same time, the work force doubled to nearly 2,700.
[Hmm, an original staff-to-member ratio of 1:265 goes to 1:407. In other words, three times the members with just twice the staff? That doesn't sound like a "misguided expansion"! Sounds more like, How could they go wrong?]
But costs overwhelmed the out-of-state business, where the plan never got enough members to achieve economies of scale, Tufts officials have said.
[Sounds like a weak excuse.]
Yesterday's round of layoffs came partly in response to the need to pull out of Me., RI, and NH..., [Tufts sr. VP fo planning and development, Jon] Kingsdale said.
[Well only 90/430 cuts (21%) are from outside Mass. What gives?]
"We have to make sure that as we shrink the premium base, that we shrink the administrative costs as well," he said.
[Well with 340/430 cuts (79%) from inside Mass., he'll definitely be doing that, but how far from the 1994 ratio of 1 staff to 265 members will they be going here?]
He added that Tufts doesn't anticipate any additional layoffs....
[Funny thing, they never do. But look at this formula for customer satisfaction -]
In addition to savings from the job cuts, Tufts officials said the plan hopes to save $14m in 2000 from higher premiums and restructured [i.e., lower] drug benefits..\..
[So - fewer staff, higher premiums and lower benefits. And still he says -]
"We wanted to make sure we take all our medicine now instead of going through a series of these things"....
[So now he's "sure" - does he want to place any bets on that?...]
- Revlon to cut about 280 positions in N.Y., N.J., Bloomberg via Bos Globe, D2.
...to cut costs.
[Corporate quandary #1 at the Turn of the Millennium - how to cut costs without cutting markets. (By cutting consumers off from their livelihoods???) Corporate quandary #2 - how to get just as much market out of way fewer, much much much richer people as they used to get out of many many many more, doin'-fine people.]
Revlon will fire about 200 workers and eliminate 80 vacant positions.... The cuts will reduce Revlon's New York HQ staff by 11% and its statewide NJ staff by 6%.... The company...said in January [1/12/99 story] it would eliminate 1,000 to 1,200 jobs, or about 7% of its work force, to lower costs as sales slumped.
[Let's assume that the current NY HQ 11% and NJ 6% is covered by that overall 7%. And since we didn't count the overall 1000-1200 into our 1/2YTD totals in Jan. because our 1/2YTD totals only started on July 4, we'll count the 280 piecemeal now.]
12/04/99 4 downsizings reported, totaling 3700 jobs + unspecified -
- Hasbro to cut 20% of its jobs and take a $97 million charge, by Milt Freudenheim, NYT, C1.
The toymaker...said yesterday that it was eliminating 2,200 jobs...and taking a restructuring charge of $97m...in 4Q99.... Retail sales of Hasbro's "Star Wars" line were sluggish as the latest movie failed to meet the hype-induced expectations at the box office...raising concerns in the industry about a crimp in demand for new toys next year..\.. The company, based in Pawtucket, RI, hopes to compensate with Pokémon trading cards, one of this year's sensations.... Pokémon sales exceeded $100m, bolstered by Hasbro's purchase of the maker of the cards, Wizard of the Coast.... The company said Furby dolls, another strong seller, brought in $300m this year....
[Good grief, they've got Star Wars, Furby and Pokémon and they're still whining? Let them cut 20% of their workweek instead of their workforce and give their own employees more time to play with their kids. Let's see Hasbro set an example of the kind of family time and good jobs we should all have by now, instead of expecting to keep downsizing and still have healthy markets.]
"The toy industry is switching to electronics," said Jim Silver, publisher of The Toy Book, a monthly trade magazine....
[High tech is no magic bullet for maintaining markets if we use it to downsize employees, wage "costs" and consumer spending, instead of cutting hours and maintaining wages and spending. As Reuther said to Ford when Ford showed him around a newly mechanized plant in the '30s and said, "Let's see you unionize these robots," - "Let's see you sell them cars."]
- IMC Global cutting 850 jobs and tak[ing] major charges, Bloomberg via NYT, C4.
...One of the world's biggest fertilizer companies said yesterday that it would cut...9.7% of its work force, and take charges of $825m in Q4 as it tries to recover from a weak North American farm economy and lower phosphate prices.... The job cuts from [Ill.-based] IMC's 8,800 workers account for about half of the $70m...IMC expects to save annually....
- Intermet to shut Ohio unit, Bloomberg via NYT, C11.
...The world's largest independent maker of cast-iron auto parts said [yesterday] that it would close down a 600-employee Ohio foundry that has lost money consistently and would be too expensive to modernize..\.. The Intermet Corp...expects to close the foundry in Ironton in the first quarter....
[Would this be the original iron foundry that gave Irontown, Ohio, its name? Shame to shut it down. How about an employee buyout? They could contact the *International Cooperative Association (now refocused onto employee ownership generally) for advice.]
- Automakers turn over their data traffic to a new operator, by Keith Bradsher, NYT, C6.
DETROIT - ...The Automotive Industry Action Group, a technology consortium of GM, Ford, DaimlerChrysler and 1,600 of their auto parts suppliers, sold..\..the assets and operations [including] computers, software, patents, copyrights and brands..\..of the auto industry's private data network...the Automotive Network Exchange...to the Science Applications International Corp...based in San Diego.... Auto industry executives will remain on the network's governing committee....
[Well, when they're this careful about specifying everything that's getting sold, and they don't mention employees, and they don't just say they're selling the whole thing, - sounds like a downsizing, with unspecified jobcuts.]
12/02 3 downsizings reported, totaling 1135 jobs -
- Tultex to shut plants, fire 2,600, Bloomberg via Boston Globe, F1.
...The ailing maker of Discus Athletic sweatshirts, filed for bankruptcy protection and will shut most of its remaining plants and fire...60% of its employees to slash costs. Martinsville, Va.-based Tultex, blaming competition from abroad, said it will close 6 of its 8 factories in Va., N.C., and Jamaica, and a distribution center in Virginia. It will hire lower-cost firms overseas to make its products.... Chief executive O. Randolph Rollins has been closing plants and firing workers in recent months, in response to high costs and slow sales of fleece clothing. Still, the moves lag rivals such as Russell Corp. and Fruit of the Loom Ltd., which have been shutting dozens of plants, firing thousands, and shifting work overseas the past few years.
[The devastation continues.]
- Severn Trent to cut 1,100, Bridge News via NYT, B2.
Britain's second-largest water company...expects to cut 1,100 jobs in the next three years to meet price targets set by British regulators. The news follows last week's announcement from the utility regulator Ofwat that the average water bill for British customers will be cut by 12% as of next April under new price controls.
[So price controls too can help induce depression.]
- PairGain Technologies plans to cut its work force, Dow Jones via NYT, B3.
...A maker of telecommunications products said yesterday that it would cut its work force in Tustin, Calif., by shifting production to Mexico. The company will move its high-volume manufacturing operations to Monterrey, Mexico, through its contract manufacturing partner, SCI Systems Inc. of Huntsville, Ala.
[Hear again Perot's "giant sucking sound" as Mexico vacuums up American jobs.]
The number of jobs cut was not disclosed. PairGain said it was determining the size and timing of the cuts and planned to help affected workers find other jobs.
[Hey, at least they tell us the number of jobcuts wasn't disclosed. Our last bizarre downsizing story today doesn't even explicitly mention cuts except in the headline.]
- Holzmann workers agree to cuts, AP via NYT, B2.
Workers at Philipp Holzmann AG agreed on concessions to help the troubled company....
12/01/1999 4 downsizings reported, totaling 23,100 jobs -
- Bausch & Lomb to cut 850 jobs and combine operations, AP via NYT, C4.
...The eye-care company...based in Rochester..\..is consolidating its manufacturing operations and cutting about 850 jobs, or 7.1% of its work force, in an attempt to counter heightened competition in the contact lens market.... The company, which currently employs about 12,000 people, plans to consolidate its global contact lens operations so that products manufactured the same way are brought together in each plant....
- Mortgage lender and trader to cut jobs and revamp, Reuters via NYT, C4.
Resource Bancshares Mortgage Group...said yesterday that it was cutting 242 jobs, about a fifth of its work force, and would take a charge of $3.5m for a reorg in 4Q99. It said the cuts were attributable to new Internet technology and 60% lower business volume, caused mainly by higher [mortgage] interest rates.... The company said it would consolidate its...wholesale branch operations \in\ acquiring mortgage loans and repackaging them for 2ndary mortgage markets like Fannie Mae...into six regional centers.
[Now, which of you was it that was saying technology creates more jobs than it destroys? Hmmm? We content that a majority of new technology is introduced into plants to take over routine human work and supercede human employees, for example, in the accounting field. Only a minority of new technology is introduced as a sheer job-neutral quality enhancement in the performance of an already automated function.]
- Santander to shut US fund unit, cut 43 jobs, Bloomberg via Boston Globe, C9.
Banco Santander Central Hispano SA said it's shutting down its two-year-old US fund management unit, centralizing the business in Madrid following the merger that created Spain's biggest bank. Boston-based Santander Global Advisors manages about $1.5 billion and employs 43 people, including six in London....
- [Big "disaster deposit" into Canadian national accounts via the "engine of depression" = record layoffs despite record profits -]
Profitable Canadian banks making plans for cutbacks, by Timothy Pritchard, NYT, C4.
....Canada has 1/3 more bank branches in relation to its population than the United States. The banks are now closing hundreds of traditional branches and trimming as many as 15,000 jobs..\.. Canada's biggest banks are reporting record total profits, while laying out plans to cut jobs and branches to further increase their rates of return.
[And what's going to happen to those record profits? Without cutting the banking workweek and keeping that money centrifuged among all those people, it is going to concentrate in the hands of the few, who have neither time nor need to spend it. And that means it's going to further load up the stored capital in the financial markets that is looking around for consumer-market-supported productivity to invest in. And we're laying off 15,000 units of the Canadian consumer base. So outdated rigid-workweek economics is allowing the financial markets and the top income brackets to actually suction the market support away from their own investments. This is happening all over the world and we might as well call it the "engine of depression." What is called for are guidelines to maintain at least current levels of profit reinvestment in wages, i.e., of income centrifugation, because the concentrating centripetal force on income is otherwise unbalanced and self-undermining. Timesizing is the only complete program we know of that supplies these guidelines. It does so on the least controversial basis of overtime, a market-determined factor. It uses overtime to trigger and target, finance and pace reinvestment in wages so that wage&spending growth keeps up with financial-market growth instead of getting disastrously outdistanced by it. Of course, there's also the less critical issue of declining customer service -]
...Advocacy groups are saying that fatter profits probably mean people will pay more for less service.
[We've already had major battles over ATM fees in this country - bearing in mind that the banks are already saving money by replacing tellers with ATMs. So here we go all over again. Our banks are once again playing a leading role in decentrifuging income and wealth and destroying themselves by generating depression. How many times do we have repeat the history of financial and economic depressions before we smarten up and, in Bucky Fuller's terms, "design them OUT." In the U.S. in 1995, we saw a forecast that between then and the year 2000, there would be 95,000 layoffs a year in the banking industry alone. We believe we've met that goal and can probably round up to 100,000 a year with no exaggeration. It's like government sets the primary example, and banks set the secondary example - for the whole private sector. Art Dahlberg was so impressed by the importance of the banks' role in inducing depression that he split off figures for bank mergers from the other industries in his landmark Jobs, Machines and Capitalism (1932). We have done so too, although we're very remiss about keeping up with entries.]
- [Another clear merger-downsizing connection -]
AstraZeneca to cut 1,000, Dow Jones via NYT, C4.
[We're going to count 6,000 here because we didn't count them last year.]
The British-Swedish drug company...said it was planning a restructuring of its research and development operations, cutting 1,000 jobs by 2001. About 450 positions are expected to be lost in Sweden.... The company forecast 6,000 job cuts over three years after the $35B merger of Astra and Zeneca Group last year. The company had about 10,000 research workers at the end of 1998, with 4,000 in Sweden.
- [And yet another clear merger-downsizing connection -]
Honeywell to trim 500 jobs from control unit, AP via NYT, C4.
...[i.e.,] another 500 jobs from its industrial controls business by the end of the year because of weak demand.
[We'll count 1100 (2%) here (see below) because although we covered this merger - and anticipated layoffs - on June 8, there was no discrimination then between Honeywell and AlliedSignal in that 4500-cut forecast, no percentage-of-workforce given, and it was before our half-year-to-date running totals started (on July 4) anyway.]
The latest cuts, about 250 of them at the unit's Phoenix headquarters and the rest spread around North America, are in addition to earlier cuts in the industrial controls division, the weakest of the company's three operating businesses this year. Including the 500 new cuts, Honeywell will eliminate about 1,100 jobs, or almost 2% of its worldwide payroll, by year-end because of market conditions. Another 800 jobs are expected to be cut when the company completes its planned $15B merger with AlliedSignal Inc. and closes its Minneapolis headquarters.
[Again, how did demand get so weak and market conditions get so bad? The marvel of it is, today's CEOs still aren't even asking that question. It's too big for them. They're job is just to keep downsizing (and making market conditions worse).]
- Nissan to cut U.S. work force, Bloomberg via NYT, C9.
GARDENA, Calif., Nov. 30 - ...Japan's money-losing No.2 automaker said today that it would cut 10% of its U.S. work force, or about 1,000 jobs, by March 2001 as part of a global restructuring plan announced last month. The cuts will affect all levels of North American operations except for workers at the factory in Smyrna, Tenn....
[And how long are they going to be spared....]
Nissan...said last month that it would eliminate 14% of its global work force, or 21,000 jobs, by 2003 and close four plants in Japan....
[Gee, where did the market for new cars go? Of course, there couldn't possibly be any connection with the rounds and rounds and rounds of downsizings or rightsizings or (our personal fave) smartsizings that have been going on all over the world since the 1970s.]
Click here for downsizing stories in Nov/99.
Click here for downsizing stories in Oct/99.
Click here for downsizing stories in Sept/99.
Click here for downsizing stories Aug.16-31/99.
Click here for downsizing stories Aug.1-15/99.
Click here for downsizing stories in July/99.
Click here for downsizing stories in May-Jun/99.
Click here for downsizing stories in Mar-Apr/99.
Click here for downsizing stories in Jan-Feb/99.
Click here for downsizing stories in December/98.
Click here for downsizing stories in November/98.
Click here for downsizing stories in October/98.
Click here for downsizing stories prior to Sept. 30/98.
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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