Caterpillar, Sprint, Pfizer Slash Jobs as Sales Fall (Update2)
By Don Jeffrey
Jan. 26 (Bloomberg) -- Caterpillar Inc.,Sprint Nextel Corp., Home Depot Inc.and ING Groep NV led companies today announcing at least 74,000 job cuts as sales withered and construction slowed amid a global economic recession that may persist through 2009.
In the U.S., the firings brought the number of job eliminations this month to at least 150,500, according to Chicago-based executive search firm Challenger Gray & Christmas.
The firings came as American jobless claims hit a 26-year high, reaching 589,000 in the week ended Jan. 17, as shrinking demand for products and services forced companies to lower costs.
“These are not just numbers on a page,” U.S. President Barack Obama said at the White House, referring to recent job cut announcements. “We cannot afford delays” in getting an $825 billion economic recovery program through Congress.
Today’s biggest layoffs were at Peoria, Illinois-based Caterpillar. The world’s largest maker of construction equipment said it’s cutting 20,000 jobs after fourth-quarter profit fell by almost a third.
Pfizer Inc., the New York-based drugmaker that’s acquiring competitor Wyeth for $68 billion, said it will close five factories and eliminate 19,000 jobs, or 15 percent, of the combined company’s workforce.
Sprint Nextel, the U.S. wireless carrier, will eliminate 8,000 jobs, or 14 percent of its workforce, in order to reduce expenses by $1.2 billion a year.
Home Depot
Home Depot, the world’s largest home-improvement retailer, said it will cut 7,000 jobs, or 2 percent of its workforce, and exit its Expo home-décor business.
“Certainly since 2001, with the dot-com collapse, we haven’t seen these kinds of large cuts,” Challenger Gray spokesman James Pedderson said in an interview. “In terms of the number of companies and the number of cuts, this morning is certainly unusual.”
The biggest month for U.S. job cuts since Challenger Gray has been compiling data was January 2002, when 248,475 positions were eliminated. Today’s figures included layoffs outside the U.S.
Before today, at least 15 companies announced they planned to eliminate 93,000 positions so far in January, Challenger Gray said. Topping that list was Circuit City Stores Inc., the bankrupt consumer-electronics retailer that’s shutting down its U.S. stores and firing more than 30,000 people.
General Motors Corp., the largest U.S. automaker, said today it will eliminate shifts at Michigan and Ohio plants, shedding 2,000 jobs as sales drop.
European Jobs
In Europe, ING, the biggest Dutch financial-services company, said it will reduce its workforce by 5.4 percent, eliminating 7,000 jobs, after its second consecutive quarterly loss.
Royal Philips Electronics NV, Europe’s largest maker of consumer electronics, said it will cut 6,000 positions after its first quarterly loss in almost six years.
Corus, the unit of India’s Tata Steel Ltd. that’s Europe’s second-biggest steelmaker, said it will reduce its workforce by 8 percent, or 3,500 jobs, as demand from builders and automakers declines.
Barnes Group Inc., the aerospace manufacturer, said today it had reduced its workforce by an additional 800 positions to 5,700 as of Dec. 31, citing “severe declines in the transportation” market and the effects of the Boeing Co. strike.
Lincoln National Corp., the life-insurer, said it’s cutting 5 percent of its staff, or 540 jobs, after posting five straight declines in quarterly profit.
Eliminating Workers
Brooks Automation Inc., a maker of robots and pumps used to produce microchips, said it’s eliminating 350 more jobs after reducing its workforce by 10 percent in the fourth quarter of last year.
Altus Pharmaceuticals Inc. said it will cut 75 percent of its workforce after realigning its product offerings.
Caterpillar and Pfizer fell 10 percent at 1:55 p.m. in New York Stock Exchange composite trading. Home Depot rose 3.9 percent and Sprint gained 1 percent.
Last week, International Business Machines Corp. cut at least 1,400 sales jobs, according to a copy of a separation agreement obtained by Bloomberg.
To contact the reporter on this story: Don Jeffrey in New York atdjeffrey1@bloomberg.net.
Last Updated: January 26, 2009 14:47 EST
Posts
