The pace of large layoff announcements increased last week after having slowed down for the previous four weeks.
By far the largest reduction was by United Technologies Corp., which said it will eliminate 11,600 jobs as part of a wider global restructuring. The conglomerate, best known as the maker of Otis Elevators and Carrier air conditioners, said the restructuring is in response to anticipated 2009 revenues that are $2.7 billion below the company’s December guidance due to contracting markets worldwide.
“These expanded restructuring actions are required to protect UTC profitability and are expected to position the company for resumed earnings growth in 2010,” said CEO Louis Chenevert.
Elsewhere, PPG Industries said it would implement another restructuring, which will result in an additional 2,500 job cuts. It cited global economic conditions, low end-market demand, and acceleration of cost savings from integrating the SigmaKalon businesses acquired in 2008.
The supplier of paints, coatings, and other products said the planned actions are expected to result in pretax cost savings of about $60 million in 2009, growing to an annual run rate of about $140 million thereafter.
Last September, PPG announced a restructuring plan that resulted in the reduction of 1,357 jobs.
“We are making significant structural changes to the way we operate our businesses,” said Charles Bunch, PPG’s chairman and chief executive officer. “By implementing this program, not only will we be better able to weather today’s difficult conditions, we will also be a more efficient company coming out of the current economic downturn.”
The McClatchy Co. said it plans to reduce its workforce by about 15 percent, or 1,600 full-time-equivalent employees. The company explained that it is accelerating efforts to manage through an increasingly poor national economic environment. It said it will achieve the reductions through severance programs, attrition, and further consolidations and outsourcing of some business functions.
The embattled media company said it expects to incur an estimated $30 million of severance costs in connection with these reductions. The workforce reductions will begin by the end of the first quarter of 2009. The plan also involves wage reductions across the company for additional savings.
Elsewhere, National Semiconductor Corp. said it will immediately eliminate 850 positions. In addition, it said it will consolidate manufacturing facilities, affecting an additional 875 positions over the next several quarters.
“The worldwide recession has impacted National’s business as demand has fallen considerably,” said Brian Halla, chairman and CEO. “However, the actions we announced today will help us remain competitive as we continue to focus on growing markets that can benefit from our new energy-efficiency initiatives.”
Meanwhile, Fleetwood Enterprises, a producer of recreational vehicles and manufactured housing, filed for Chapter 11 earlier in the week. The company said the filing also facilitates the closing of its travel-trailer division, which had already begun.
The division closing affects three manufacturing facilities and two service facilities employing about 675 people. The company is also laying off an additional 65 corporate positions.
Some major pharmaceutical deals threaten to result in major layoffs as the companies integrate their operations. Bloomberg noted that Dow Chemical Co. will cut 3,500 jobs as part of major cost-cutting when it closes on its acquisition of Rohm & Haas Co. And no doubt there will be major job cuts when Merck & Co. completes its planned $41.1 billion acquisition of Schering-Plough.