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Downsizings, March 1-15/2001
[Commentary] ©2001 Phil Hyde, The Timesizing Wire, Box 117, Harvard Square, Cambridge MA 02238 USA (617) 623-8080

3/15/2001  5 downsizings cited in NY Times (NYT) & Boston Globe (BG), totaling 2,902 lost jobs (not counting 150 Calif. layoffs (40%) according to "Homes.com to reduce staff," March 14 PRNewswire via AOLNews 14 Mar 2001 12:16:20 via RadioTony) -

1. Intel postpones Irish expansion, by Brian Lavery, NYT, C4.
   The chip-making giant [will] lay off 1,400 construction workers and postpone the expansion of its west Dublin chip production site in order to save on costs. The $2B expansion, heralded last June as the largest foreign investment in Ireland, will now begin operations in 2003, rather than later this year.

2. Kimball International to miss third-quarter estimate, Bloomberg via NYT, C4.
   ...[A m aker of] office furniture and electronic parts said yesterday...that it had laid off 600 workers since January, citing slow demand for durable goods....

3. Texas Instruments closing California factory, Bloomberg via NYT, C4.
   ...[The firm] whose chips run two-thirds of the world's cell phones [will] close a semiconductor plant in Santa Cruz, Calif. and lays off the 600 workers there. TI, which is based in Dallas, [will] offer a small percentage of the employees other positions within the company.

4. Britannica cuts back online, by Elizabeth Stanton, NYT, C4.
   The online encyclopedia Britannica.com [will] dismiss 68 of its 220 U.S. employees beginning this week. The Web site, which offers free information from the print version of Encyclopedia Britannica, has not shown a profit since it was introduced in October 1999. The latest cuts add to numerous executive departures and 84 layoffs since November. ...Plans call for more fee-based services to "achieve profitability by some time next year." The layoffs will not affect Encyclopedia Britannica Inc., also owned by Encyclopedia Britannica Holding.

5. Credit Suisse First Boston online unit to cut 150 jobs, Bloomberg via NYT, C4.
   CSFBdirect...plans to dismiss...10% of its work force, and close its New Jersey call center to trim expenses [by $11m/yr] as investors reduce trading on the Internet. [It] is the latest brokerage company to show how a collapse in technology stocks is rippling through the industry. The call center being closed, where customer service representatives take client orders, is in Parsippany, NJ. The company will still have three call centers.

1. Motorola sets a further cut of 7,000 jobs, Reuters via NYT, C4.
   ...as it tries to strengthen its cellular phone unit amid an industrywide slowdown in sales..\.. The mobile phone maker...based in Schaumberg, Ill. said the job cuts - equivalent to 5% of the work force - would increase the reductions in its cellular phone operations this year to 12,000, or 36% of the unit's employees at the end of last year.... Motorola employs 140,000 people worldwide in all its businesses and ranks behind Nokia in cellular phone production. It [will] complete the job cuts in the next two quarters....

2. Japan Airlines plans to cut 4,200 workers, Bloomberg via NYT, C2.
   ...Asia's biggest carrier [plans] to cut ground staff by almost half as part of its latest effort to reduce costs....
   [Ohoh, does that include maintenance? Better cancel your Japan Airlines reservations.]
   The midterm plan, which runs through March 2004, aims to cut 4,200 ground workers by March 2003, down from the 9,000 it employed as of March 2000.... "This is for the long-term competitiveness of JAL," said Satoshi Abe, an analyst at Daiwa Institute of Research.... Japan Airlines is likely to face slumping growth this year as Asian economies slow....

3. Cable and Wireless cuts [4,000] jobs, Bloomberg via NYT, W1.
   ...in the next 12 months to help reduce costs as margins erode in its Internet business because of falling prices in the United States and Japan....
   [Presumably in the UK.]

4. Bozell closes offices in Texas, by Stuart Elliott, NYT, C10.
   The Bozell Group unit of True North Communications will close the Irving, Tex., offices of two agencies, Bozell Kamstra and SixtyFootSpider, after losing the United States Air Force account in November to GSD&M in Austin, Tex., part of the Omnicom Group.... The Bozell Kamstra office has 37 employees and the SixtyFootSpider office has 20..\.. Kathleen Ruane, a spokeswoman at the Bozell Group in NY...said it was possible that employees would be asked to transfer to the agencies other offices.

1. [It's that "giant sucking sound" again, of jobs flying to Mexico, not of people slurping pop.]
   IMI to eliminate jobs, Bloomberg via NYT, W1.
   ...[A supplier of] drink dispensers to the Coca-Cola Co., [will] cut 1,200 jobs to cut costs amid weakening demand for carbonated drinks.... Most of the cuts will come in the United States and Germany, as IMI shifts production to China and Mexico.... Earnings at IMI's drink dispenser unit, which accounts for 20% of its sales, fell 3.5% last year as consumer tastes shifted away from carbonated soda to mineral water and fruit drinks.

2. Job cuts are planned at Arthur D. Little, NYT, C2.
   ...as many as 200 [6%] of its 3,200 consultants, up to 60 of them at its Cambridge, Mass., headquarters. It also [will] close unprofitable offices, including branches in Buenos Aires, [Argentina]; Bogota, Colombia; and Mumbai, India. The announcement...came as the consulting business is having a slowdown.... In a news release, [ADL] said the layoffs were necessary because of the withdrawal of a public offering for C-Quential, a technology consulting firm formed from the company's management consulting practice [which will now be reintegrated into the firm]....

3. Peapod, online grocer, quits San Francisco, Bloomberg via NYT, C6.
   ...and is referring customers to the rival Webvan Group. Peapod, based in Skokie, Ill., [will] focus on the Eastern United States, where [parent Dutch-based Royal] Ahold operates the Stop & Shop supermarket chain. Online grocers have been struggling to turn a profit.
   [So, unspecified S.F. jobcuts.]

1. Cisco plans steep job cuts and a charge - Computer networking feels U.S. slowdown, by Chris Gaither, NYT, B1.
   The slowdown in information technology spending hit the sturdiest of computer-networking companies [yester]day, as [San Jose CA-based] Cisco Systems said it intended to eliminate as many as 5,000 jobs, or 11% of its full-time work force.... About half of the job reductions will come from layoffs, [and] the other half through normal attrition.... Its regular workforce [is] 44,000..\.. To save money as its revenues slow, Cisco [also] intends to cut its pool of temporary and contract workers sharply. [As many as] 3,000 of the 4,000 temporary jobs will be eliminated..\.. "We're taking these steps because of the continuing slowdown in the U.S. economy and initial signs of a slowdown expanding to other parts of the world," John Chambers, Cisco's chief executive, said in a statement....
   [So, 5000 jobcuts out of 44,000 in regular workforce plus 3000 cuts out of 4000 in temporary workforce gives us an overall percentage of 17%. Plus Cisco has come up with a new example of double-speak to describe these layoffs, according to "Plain speaking also falls victim to Cisco's ax," by Steve Rubenstein, San Francisco Chronicle 3-10-01 via alert reader Scott Thibodeau - "The company, which is firing 8,000, says it isn't firing them. Company spokesman Tom Galvin reached into the linguistic cookie jar yesterday and declared that the employees were to undergo 'normal involuntary attrition.'... Said Julian Boyd, professor of English emeritus at UCalBerkeley...'It's comical. It's someone trying to avoid blame....' Concocting new phrases does not fool anyone, according to Mike Swensen, president of Barkley Evergreen & Partners, a firm that helps companies handle layoffs. 'I think they get what they deserve in terms of skepticism or loss of credibility,' Swensen said...."]

2. Cummins plant plans plant closings as part of revamping, AP via NYT, B3.
   The diesel engine and products manufacturer [will] close two plants as part of a restructuring announced last year. The Onan Power Equipment plant in St. Peter, Minn. [which] employs 320 people and makes electronic components for power generation systems...is expected to cease operations by October. The second plant, in Eden Prairie, Minn. [which] employs 20 full-time workers...is tentatively scheduled to be [phased out] by the end of the second quarter. Local managers said Cummins, based in Columbus, Ind., made the decision because of market downturns and available capacity at the company's plant in Fridley, Minn.

3. Dow Jones and At Home to halt Internet venture, Dow Jones via NYT, B3.
   ...Work.com...on March 31. ...The decision was made because of the current decline in online advertising spending and the challenges of getting more financing. The companies said the majority of Work.com's 113 full-time employees in Redwood City, Calif., and in New York would be leaving the company next week.
   [So let's call it 51% of 113 = 58 jobcuts.]
   The others will remain for various time periods to assist in the orderly phase-out of the company and its relationship wtih vendors and partners.

4. USFreightways plans to make deep job cuts, Bloomberg via NYT, B3.
   ...The 2nd-largest operator of regional trucking companies in the nationa [plans unspecified but] significant job cuts...because of the economic slowdown and bad weather. ...Chicago-based...USFreightways has been hurt as companies cut orders and factory employment.... The company said Q1 results would be below forecasts because of lower revenue and volume in several units, including freight forwarding and logistics.

5. Branches to be closed, by Scott Nelson, BG, F1.
   FleetBoston Financial Corp. announced plans to close a dozen Connecticut bank branches in the first wave of cost-cutting following its recent takeover of Summit Bancorp. Four Fleet branches and eiht Summit branches will be closed, beginning June 22 and July 7, respectively. After the closings, Fleet will remain the largest bank in Connecticut, with 183 branches and more than 400 ATMs....
   [So, the lethal takeover-downsizing connection with unspecified jobcuts.]

1. Intel again warns of slumping revenue this quarter - Weaker demand will also mean cutting 5,000 jobs, by Chris Gaither, NYT, C2.
   ...by year's end, mainly through normal attrition, and trim spending on research and development by 2%.... The world's largest chip maker said large customers had canceled orders in all segments of its business. A decline in sales for its microprocessors, which power personal computers, was expected. But...demand was even weaker for chips that power server systems, communications devices and networking systems. "We expected it to pick up here in the second half of the quarter, and we haven't seen it"..\..Andy Bryant, the company's CFO, said...of the company's sales. "There are days you come in and you find two positive signs, and the next day you come in and find three negative signs."
   [Sounds like the news in general these days, and come to think of it, sounds like the news in general for the first three quarters of 1929.]
   Craig Barrett, Intel's chief executive, had repeatedly said he intended to spend his way through the economic slowdown....
   [You can't spend your way through an economic slowdown because the 1920-41 Depression taught us that a slowdown is not necessarily temporary - it can be indefinite - but you can timesize your way through an economic slowdown because timesizing is a sustainable strategy and spending regardless of income is not. One question remains - what percentage is Intel laying off this time? For that, we have to go to the Globe -]
   Intel to cut 5,000 jobs..., AP via BG, D2.
   ...or 6% of its work force during the next nine months, mainly through attrition....

2. C-bridge to post loss, take charge, Bloomberg via BG, D5.
   C-bridge Internet Solutions Inc., whose shares have fallen 95% over the past year, [is] cutting 105 jobs...in North America and the Asia-Pacific region, and shutting its Sydney office.... C-bridge will take a charge of about $2m related to cuts....
   This is the second time this year that...Cambridge MA-based C-bridge..\..has cut jobs. In January, the company fired 100 workers, or about 14% of its work force, to reduce costs....

1. TRW to reduce its work force by 1%, Bloomberg via NYT, C4.
   ...The No. 2 maker of airbags [will] eliminate 1,000 jobs at the company's automotive unit, or about 1% of its total work force, to cut costs as carmakers reduce production. TRW will take a $40m charge to pay for the job cuts in Q1.... Eliminating the jobs may lower employee expenses by about $40m a year, analysts said. About 64% of TRW's sales...came from automotive parts, and the remainder from space and military products. The jobs being cut are all salaried positions.

2. Copper Mountain Networks sets restructuring, Reuters via NYT, C4.
   ...A maker of equipment for high-speed Internet connections [plans] to restructure, eliminating about 25% [113] of its 450-person work force.... Most of the job reductions [will] be in sales, customer support, operations, and general and administrative support....
   [Sounds like everywhere.]

3. Layoffs protested in China, by Craig Smith, NYT, W1.
   More than 1,000 workers protested layoffs at the Shanghai Tyre and Rubber Co. in an industrial suburb of Shanghai but were dispersed by the police. Such protests are becoming more common in China as the state cuts subsidies and banks cut off credit for money-losing government-owned enterprises like Shanghai Tyre, and they're likely to spread after China enters the WTO and competitive pressures increase. [Also,] Zeng Peiyan...the head of China's State Planning Commission, said that he expected bankruptcies to rise after the country joins the WTO.
   [So, unspecified jobcuts.]

4. Daewoo closing units, by Don Kirk, NYT, W1.
   The Daiwoo Electronics Co...is shutting down 8 of its remaining 62 overseas operations...in South America and the former Soviet Union as part of an overall restructuring program....
   [ERGO, unspecified jobcuts.]

5. Incubator firm Idealab to halt operations from Silicon Valley, Bloomberg via BG, E4.
   PASADENA, Calif.- ...The Internet investment firm best known for backing EToys Inc. [will] wind down its Silicon Valley operations, the latest retrenchment by the Web incubator company.... Idealab in January [1/16] fired some employees in all five of its offices.
   [Alors, unspecified jobcuts.]

• Citing slowdown, San Jose newspaper plans layoffs, AP via NYT, C6.
  Blaming a steep fall in help-wanted ad revenue and other signs of an economic slowdown in Silicon Valley, The San Jose Mercury News is planning to lay off some of its 1,700 workers. Early retirement offers may help, but "we will be unable to achieve the level of expense reduction we are seeking to achieve without layoffs," the chairman and publisher, Jay Harris, said in a memo to the staff on Monday.
  [Sure you will, Jay, if you use some imagination and cut your workweek instead of cutting your workforce.]
  All departments of the paper, part of Knight Ridder, will be examined as the company decides where to cut jobs, Mr. Harris said.
  [Absolutely brilliant. "Maximize uncertainty." Now instead of getting everyone more focused on their job, they've got every single employee feeling his/her throat and, if s/he has any self-respect, tuning up the ol' resume and sending it out far and wide. This employer has not only "employed" an unnecessary, self-destructive strategy but implemented it in the most self-destructive possible way - guaranteed to lose its best and brightest first.]

3/3/2001  2 downsizings cited in NY Times (NYT) & Boston Globe (BG), totaling 720 lost US jobs + unspecified (not counting "Friede Goldman [Halter] lays off about 1,000, [16.7%, at a Pascagoula, Miss. shipyard]," AP-NY-03-02-01 1859EST via AOLNews via RadioTony, and "Chapters [Canada's biggest bookseller] cuts 130 jobs at [Pegasus Wholesale] arm," Reuters 18:18 03-02-01 via AOLNews via RadioTony) -

1. Sapient planning to ax 20% of jobs, by Michael Rosenwald, BG, C1.
   ...An Internet consulting company with offices around the world [is] slashing its work force by [720 people] amid a dramatic slowdown in sales plaguing the entire sector.... Edward Goldfinger, the company's CFO, said 140 of the layoffs are at the Cambridge MA headquarters. Sapient also is cutting and consolidating other offices around the country and closing its office in Sydney [Australia]....
   [Thanks to "Sapient to fire 720 workers, expects 1st-quarter loss," Bloomberg Mar/02/2001 via AOLNews and "Sapient of Cambridge to cut 20%," Dow Jones 02 Mar 2001 via SomervilleActivist (Matt Hoey) for the absolute number of layoffs here.]

2. SBC Communications to cut jobs at telecom unit, Bloomberg via NYT, B3.
   ...The No. 2 US local-telephone company will cut an unspecified number of jobs at its SBC Telecom unit to reduce expenses.... The unit...sells services outside the company's traditional territories...in the Southwest and Midwest [through] offices in New York, Boston, Philadelphia and other cities....

1. Good Guys [Inc.] to lay off workers and move headquarters, Bloomberg via NYT, C3.
   [So 'good guys' can be 'bad guys' -]
   ...An operator of consumer electronics stores in the West [will] lay off 450 employees, or 10% of its work force...to cut costs. The job cuts include 125 sales and 300 sales-support positions. An additional 25 workers were laid off from its San Francisco-area headquarters, distribution and call centers. Good Guys will move its HQ to the East Bay of San Francisco from Brisbane, Calif., a move that will reduce real estate costs by 50%.

2. WestPoint Stevens to close South Carolina plant, Reuters via NYT, C3.
   ...A maker of sheets and towels [will] close its fourth plant in a year, affecting 292 employees. ...The yarn plant in Whitmore, SC will begin shutting down immediately and cease operations by May 1. "Yarn produced at the Whitmore plant has to be hauled significant distances to reach any of our weaving facilities," Lanny Bledsoe, senior VP for mfg said in a statement. "This has become especially critical in the fact of continuing higher fuel prices." The company [will] move machinery from the plant to other manufacturing operations and...the amount of yarn produced internally [will] not be affected.

3. Lotus eliminates 183 jobs, by Hiawatha Bray, BG, C3.
   Lotus Development Corp's chief executive, Al Zollar, warned in January that his restructuring efforts at the Cambridge software company might include layoffs. Now, [2.4%] of Lotus's 7,500 employees have found out Zollar wasn't kidding.... The workers will have 60 days to find other jobs at Lotus or at its parent company, IBM Corp., before being terminated. ...Lotus plans to align its management structure more closely with IBM's [which] means eliminating some jobs.... Zollar...said that the company's traditional market for "groupware" - software to help teams of people work together - is maturing and that it faces tough competition from rival Microsoft Corp....

1. WorldCom to cut 7% of jobs, by Seth Schiesel, NYT, C9.
   ...or about 6,000 people...as WorldCom tries to streamline operations before a planned restructuring this spring. ...The cuts would come largely at the company's network operations center in Ashburn, Va.; at network technology operations in Tulsa, Okla., and Richardson, Tex.; and at WorldCom's sales and marketing operation in Atlanta. ...Each employee can cost a big communications company about $150,000 a year, including benefits and overhead. Based on that estimate, WorldCom would save $900m a year from the reductions....
   [And what kind of productivity, service, morale and customers would it lose?]
   ...Some analysts will interpret the cuts as a response to the overall weakness in the long-distance market. ...The proliferation of new carriers...has helped foster price wars in many long-distance segments, putting pressure on long-distance companies both young and old.

2. Circuit City [Group] sets 300-job layoff, Bloomberg via BG, D2.
   ...The second-biggest US electronics chain...will take a $5m pretax charge in the fourth quarter ended yesterday for the job cuts, which represent less than 1% of its workforce.... The firings mainly will be made in its corporate and division offices....
   [The Globe doesn't bother to tell us where.]
   Circuit City...will have 53,400 employees left after the firings. ...Shares fell....

3. Buy.com cuts jobs and quit golf, Bloomberg via NYT, C4.
   ...125 jobs, or about half of its workforce, and stop selling golf products as it tries to become profitable....

4. Walmart.com to cut jobs and product offerings, Bloomberg via NYT, C4.
   ...24 employees, 10% of its workforce...primarily in merchandising and marketing..\..and eliminate...some low-priced apparel and cosmetics and beauty items that have shipping costs that make them unattractive for customers to buy online....

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