Timesizing® Associates - HOMEPAGE

Downsizings, Aug.16-31, 2003
[Commentary] ©2003 Phil Hyde, The Timesizing Wire, Box 117, Harvard Square, Cambridge MA 02238 USA (617) 623-8080

8/30/2003   1 downsizing, totaling 373 jobcuts , reported in Wall St Journal & NY Times
(not counting economywide "Lose job, pay less taxes," letter to ed by David Roberts of Chicago, 8/31/2003 Boston Globe, E2, which states, "We are in a largely jobless recovery after three major taxcuts.... It would be hard to design a less efficient economic stimulus plan. When pResident Bush offered taxcuts for everyone...he didn't explain that for many, the biggest part of the taxcut would come from losing a job..\.. Millions of people who have lost good jobs and now survive on low-paying jobs or unemployment compensation are [indeed] receiving major tax cuts. They have lower income, so they pay lower taxes.") -

  1. RadioShack plans to...eliminate 373 jobs at plants in Texas and NC, NYT, B3.
8/29/2003   3 downsizings, totaling 5,100 jobcuts + unspecified, reported in Wall St Journal & NY Times
(not counting industrywide "Utility cutbacks worried states before blackout - Rate freezes spurred by deregulation weighed on staffing, maintenance," by Smith & Hawkins, WSJ, A2, which states, "Even before this month's massive blackout, state regulators in the Midwest and Northeast were concerned about the extent to which utilities had slashed staffing and cut spending on maintenance.") -
  1. Konica Minolta plans 4600 job cuts...12% reduction in workforce to 33,800 over next 3 yrs in Japan...to double group operating profit, WSJ, A10.

  2. Goodyear Tire & Rubber to cut 500 workers, NYT, C3 (//WSJ C14).

  3. Sears Roebuck to close 3 stores in Great Indoors chain...unspecified cuts, NYT, C3 (//WSJ C14).

8/28/2003   4 downsizings, totaling 1,835 jobcuts, reported in Wall St Journal & NY Times -
  1. Matsushita Electric Industrial Co...1,100 jobcuts of 288,000 (0.4%) via early retirement...closing 2 Japan plants & moving motor mfg to China, WSJ, B6.

  2. Silicon Graphics Inc...600 more jobcuts, WSJ, B6.

  3. Oneida Ltd...100 jobcuts, NYT, C4.

  4. National Bank of Canada's Putnam Lovell NBF Securities Inc. unit...35 jobcuts, NYT, C4.

8/27/2003   2 downsizings, totaling 450 jobcuts, reported in Wall St Journal & NY Times -
(not counting economywide "As factory jobs vanish, there's value in buildings," NYT, C5, sorta like "neutron-bomb economics" - 'cept sooner or later an actual economy might need some actual employees dba customers, and "More women in J-school doesn't translate to jobs," Boston Globe, C1, where J-school is journalism school) -
  1. SKF AB, NYT, C3.
    ...Gothenburg, Sweden, the world's largest maker of ball bearings, [will] close factories in Altoona PA and Jamestown NY to reduce costs and transfer production to other plants in the U.S. and Mexico. The company did not say how many of 300 jobs would be eliminated.
    [Duh, in factory closings it is customary to simply count them all.]

  2. Computer company cuts jobs and shuts offices, Bloomberg via NYT, C2.
    The Computer Network Technology Corp., which provides software and hardware for for computer storage networks, cut about 150 jobs after it combined some operations and closed offices.

8/26/2003   1 downsizing, totaling 150 jobcuts + unspecified, reported in Wall St Journal & NY Times -
(not counting economywide "Capital exchange," pointer blurb (to WSJ.com), WSJ, front page, which states, "Readers challenge David Wessel's assertion that, despite the jobless recovery, rising productivity is good for U.S. workers." - it's not only the common false assumption that wages rise with productivity that needs challenging (they rise only with labor/skill scarcity) and the common flawed fixation on productivity regardless of marketability - it's also the common downsizing response to increased productivity, e.g., from worksaving technology, instead of a timesizing response which would preserve our workforce and our markets) -
  1. Germany: Drug maker cutting operations, by Victor Homola, WSJ, W1.
    ...Pfizer...based in New York..\..plans to reduce its operations in Germany in response to the country's planned changes in healthcare policy, Walter Koebele, the head of the company's German unit, told the newspaper Die Welt.... Pfizer has already decided to move its research unit, which employs 150 people, from Germany to Britain.
    [Too far and too language-barriered to pass as a simple relocation, so, 150 jobcuts in research unit plus unspecified additional from general operations reduction.]
8/23/2003   4 economywide stories (uncounted in rollups) & 3 counted downsizings, totaling 2,220 jobcuts, reported in Wall St Journal & NY Times -
( not counting economywide -
  1. Boeing sends layoff notices to 1,440 workers, AP via NYT, B4.
    ...About 1,250...are in the Puget Sound area. The total includes 225 printing employees in Boeing's Shared Services Group...based in Bellevue WA [whic] handles telecomms, travel and other needs across the company.
    [So Boeing is opting to let employees "do it themselves" - on probably much bigger salaries.]

  2. Dan River Inc. cuts 80 jobs and will record charge, Bloomberg via NYT, B4.
    ...to save $4.3m a year.... The company...based in Danville VA..\..which makes bed sheets and comforters...has been shedding jobs and closing plants amid weak retail demand and high inventories. It announced the elimination of 630 jobs and 2 factories in June.
    [We're going to assume the 80 are included in the 630.]

  3. The Netherlands: Akzo plans job cuts, Reuters via NYT, B3.
    The Dutch chemical group Akzo Nobel [plans] to further restructure its polymer chemicals unit and cut another 150 jobs.... Jobs will be cut [worldwide] in R&D, control and accounting, info mgmt, sales and administration....

8/21/2003   2 economywide stories (uncounted in rollups) & 3 counted downsizings, totaling 130 jobcuts + unspecified, reported in Wall St Journal & NY Times -
( not counting economywide -
  1. Sonoco Products to close New York plant with 130 workers, Bloomberg via NYT, C3.
    ...in Fulton NY...by the end of next March..\..as part of a plan to reduce costs amid falling sales and prices.... The company, based in Hartsville SC..\..makes boxes, plastic bags and food cans....
    [See also 340 cuts below on 8/19/2003 #2 - not clear if any or all overlap. Assuming no overlap, 17,500-340= 17,160 starting workforce total. So 130 is 130/17160= 0.8%.]

  2. Dillard's Inc...posts loss for quarter amid store closings, Dow Jones via WSJ, B2.
    ...underperforming stores....
    [Unspecified jobs lost.]

  3. ACES SA - [Colombia's #2 airline's] shareholder[s] will liquidate, rather than seek bankruptcy, Dow Jones via WSJ, B2.
    [Unspecified jobs lost.]

8/20/2003   1 economywide story (uncounted in rollups), reported in Wall St Journal & NY Times - 8/19/2003   2 downsizings, totaling 940 jobcuts, reported in Wall St Journal & NY Times
(not counting economywide warnings in "At this play, everyone is in the bathroom line," by Matthew Mirapaul, NYT, B3, flagged by colleague Kate, which states, "The play 'Downsize'...set in a men's room during a corporate party [and] staged in a series of [actual] bathrooms in [Chicago] public buildings [is] by Chris Welzenbach, a local playwright [and] portrays 5 white-collar workers scheming to get ahead," and also in "Ford plant finds efficiency is no protector," by Hakim & Berryman, NYT, C1, which states, "Ford told union workers at a meeting in June that no new product is scheduled for..\..the Ford Motor Co's assembly plant...in the Atlanta suburb of Hapeville..\..one of the most productive car factories on the continent...which employs 2,300 hourly workers and produces the aging Ford Taurus and Mercury Sable sedans, according to Mitchell Smith, the top UAW official at the plant. Workers were also told that plans to build a factory in Georgia were also suspended, Mr. Smith said. Coming during a summer of labor contract talks, these developments reinforce the challenge that unions face in stemming the flight of domestic manufacturing jobs and the struggles of domestic automakers to bring costs in line with foreign rivals." - confirming that productivity without marketability is irrelevant and that unless manufacturing unions focus on stopping CEOs from obsessing about productivity in isolation and on getting them to substitute timesizing for downsizing (forget about higher pay & focus on shorter hours!), those unions will be roadkill) -
  1. International Business Machines, Dow Jones via WSJ, B6 (//NYT, C1).
    ...laid off 600 workers nationwide, including about 500 at its Vermont chip-making plant.... Many of those laid off were in higher-paying positions, the computer maker said. IBM had more than 315,000 employees worldwide at the end of 2002, with 6,000 in Vermont..\..
    [600/315000 is 0.2% of its global workforce, so a 1-minute-a-day corporate work&pay week reduction would have avoided this. However, there is some timesizing, not downsizing going on here -]
    IBM said an additional 3,000 workers in Vermont will be required to take a week off without pay next month. While IBM, Armonk NY, posted profits for its Q2, it lost money on its microelectronics business as the industry suffered a sharp downturn....
    [The fact that higher-paid people are beginning to be laid off - with presumably too much of a financial buffer to be rendered catatonic - and that more people are beginning to be timesized - motivating activism without financially hobbling - may mean that we'll get some additional support for the timesizing movement. God knows the every-firm-for-itself/every-CEO-for-himself strategy, even coupled with Bill Gates' milk&charity approach, is just taking us all further down.]

  2. Sonoco Products to cut 340 jobs and close 20 plants, Bloomberg via NYT, C3.
    ...most...by the end of the year..\..to reduce expenses because of declining sales and prices, and higher costs.
    [More evidence of permanent economic depression, due to astronomically overconcentrated national income.]
    About 130...will be eliminated at the company's HQ at Hartsville SC. \The\ maker of boxes...has 17,500 employees and 300 plants.
    [Before or after? Since the cuts are future tense and this is neutral/"present" tense, we'll assume "before."]

8/17/2003   2 economywide stories (uncounted in rollups), reported in Wall St Journal & NY Times - in our usual contrarian way, we are belatedly responding to the prevailing strained optimism by fronting the doom du jour again on our homepage (as on & before 9/22/2001) till the current bubble bursts -
  1. Some entrepreneurs venture back to employee ranks, continuation [by David Wallace, dwallace(at)deadlines.net], Boston Globe, G7.
    ... BLS records [Bureau of Labor Statistics] show an increase in unemployment among people describing themselves as self-employed. This group includes agriculture, nonagriculture, and unpaid family workers (as close as the federal government gets to identifying the self-employed). From an annual figure of 2.1% in both 2000 and 2001, the figures rose to 2.6% in 2002 and peaked at 3% in January and February of this year before retreating slightly to 2.7% in July.
    [Imagine what this is doing, cumulatively, to our economywide aggregate consumption and effective demand.]
    Truck driv[ing], travel agent[ing], and countless other jobs can be done as an employee or [as a self-employed] sole proprietor. Niels Nielsen...a consultant and author of "Princeton Management Consultants Guide to Your New Job"..\..calls this group the "hidden unemployed," describing an estimated 470,000 people who dropped out of the labor market in July alone. Some are no longer considered out of work [i.e., officially "unemployed"] because they are not receiving [or even eligible for] unemployment benefits or finding other ways to make ends meet. "Hidden unemployment brings the true jobless rate up to 10.5% from the 6.2% reported in the media," said Nielsen.
    [But self-employment can mean even longer hours than what corporate jobs have deteriorated to -]
    Karen O'Neil of Hopkinton MA...recently gave up her home-based PR agency to get an employee's badge handling retail PR for Staples Corp.... After 7 years of self-employment, she grew tired of working late nights to manage her [own] billing and correspondence, she said.... Some employers are hesitant to hire people who have been their own boss, fearing they might leave to start again. [But] several traits related to her past career worked in [O'Neil's] favor, for instance, small business owners are a key market for Staples....

  2. Yes, assembly lines can mix apples and oranges, by Micheline Maynard, NYT, 3:5.
    [An article on assembly lines in auto factories that takes till paragraph 25 (out of 35) to mention robots. Hel-lo-o. So what does it mention, up in para. 5? -]
    ...The East Liberty, Ohio, [Honda] plant is at the front of a trend that is spreading rapidly through the American automobile industry: flexible manufacturing, [which] will let them build any combination of vehicles in one factory, regardless of size, design or body style....
    [By not mentioning robotics early, Micheline can spin this abstract? new? concept as a real positive, regardless of CEOs' downsizing response to it -]
    The [old] single-vehicle plant[s were] designed for economies of scale.... The big problem comes when those vehicles don't] sell and the factories have to be shut down.
    ["Oh gee, that must be terrible for employees. Maybe flexible manufacturing is really much better for them then!" But Micheline keeps the focus steady on employers.]
    Labor contracts require Detroit auto companies to pay laid-off union members practically their entire wages and all their benefits when plants are not operating. This need[?] to keep factories going also makes it costly for companies to introduce low-volume vehicles, because their limited sales cannot pay for keeping an entire plant running. ...Michael Bruynesteyn, an industry analyst at Prudential Securities, wrote that Toyota and Honda were ahead of the Big Three...in adopting flexible-manufacturing concepts, in part because...in Japan...customers' tastes change even faster than those in the U.S.... Even a decade ago, Mazda was able to build up to 14 different vehicles at its plant in Hofu...and 8 at its factory in Hiroshima.
    ...Nissan Motors [is now] repeatedly ranked as the most efficient producer of vehicles [in the U.S.] by the Harbour Report, an annual manufacturing study. Between its plant in Smyrna TN and its just-opened factory in Canton MS, Nissan can produce 10 different automobile nameplates....
    In making [flexibility] work, an important role is played by the body shop - the area where the different pieces of metal are welded together by robots, before the body moves off to be painted and the interiors installed [also largely done by robots mayhap?]. GM officials hope to have a flex system in all [GM] plants, in some form, by 2005. United Auto Workers [UAW] officials declined to comment on what that might mean for [their] members, who now number 400,000, down from 1 million in 1978.
    [600,000 UAW jobs lost in 2003-1978= 25 years. That's an average of 600,000/25= 24,000 UAW jobs lost every year for the last 25 years. Again, imagine what this is doing, cumulatively, to our economywide aggregate consumption and effective demand. And economists still want to babble about "Lump of Labor Fallacy" and "technology creates more jobs than it destroys"? - maybe technology would create more jobs than it destroyed if business schools and economists taught timesizing instead of downsizing in response to technology! And with this happening throughout manufacturing and increasingly in services, we should be able to account for almost all the average of the additional 140,704 Americans per year each year since 1974 who have done time in prisons or jails (see 8/16-18/2003 #2).]

  3. Help wanted - Maybe the talk about jobs and the need for more of them is a way to obscure a darker issue: what globalization will ultimately do to the American middle class, by Walter Kirn, NYT, Magazine 15, flagged by colleague Kate.
    [Never mind the middle class. Worry about the consumer base, and then, the whole economy.]
    A couple of weeks ago, the Secretaries of Commerce, Labor and the Treasury took a 2-day bus trip through the Midwest to...confront...the festering unemployment issue that may prove decisive in choosing the next president. ...The current jobless rate hovers a little above 6% (a good 2 points higher than when Bush took office).... Like the Democratic presidential hopefuls who've also been talking nonstop about unemployment, the road-tripping Cabinet members all agreed about the solution to joblessness: more jobs.
    [And therein they are both wrong. Both sides betray a complete misunderstanding of the reason for this joblessness, the glib assumption that markets are infinite and can take any amount of abuse. We think we can indefinitely divert technology from making life easier for everyone to giving a few people far more money than they can ever spend. We think we can indefinitely outsource jobs to Mexico, China and India without harming our American consumer base. We think markets are infinite, like oceans. We can pull any amount of fish out, and pour any amount of pollution in, and it will make no difference. But even as our actions are gradually wiping out our food fish and killing our oceans, so our downsizing and outsourcing are gradually killing our markets. Standard economists forever ignore and forget this strange occurrence - but it's what happened in the lead-in to the Great Depression and it's what's happening now. Weak sales, excess capacity and an economy running at a fraction of its potential. With no common interest, society splits into warring factions, and everyone, including the wealthy, becomes insecure. Technology guarantees that the solution is not more jobs. Technology imposes a new solution - or rather, an old solution that must be newly generalized and standardized and automated. And that solution is not job creation or makework - but worksharing or Timesizing. Walter Kirn, in ignorance, expresses skepticism about the "more jobs" solution to joblessness -]
    Much as happiness is the solution to depression and tallness is the remedy for shortness, this answer ["more jobs"] makes sense on the surface, if not beneath it.
    [But the solution to depression is more likely sharing your woes with someone else - misery loves company - and the remedy for shortness is the society of other short people, or even people shorter than yourself - people with whom you share the problem. Thus standard-brained commentators overlook the most frequent and obvious solution - more communication, more sharing. Then Kirn goes off on a new idea of the difference between Republicans and Democrats -]
    The only dispute among the politicians is over how to get these extra jobs: Both methods promise the same result, of course: a drop in the jobless rate of a couple of points or so....
    [- never mind the Republican way is impossible without strong markets and the Democrat's way just solves outsourcing, not downsizing - while worksharing in America (1938-40) and France (1997-2001) both brought the unemployment rate down 1% for every hour's reduction in the workweek. Kirn goes on to another aspect of the problem: those with the problem are jobless and moneyless and powerless while those with jobs and money don't have the problem (or the time!) -]
    ..\..Both methods promise...a drop in the jobless rate...to a level we needn't fret so much about - never mind that for people out of work, unemployment is always 100%, while for people who do have work it's 0%, even if only three of them remain....
    [As Sismondi said in 1819, "In truth then, there is nothing more to wish for than that the king, remaining alone on the island, by constantly turning a crank, might produce, through automata, all the output of England." From New Principles of Political Economy, trans. Richard Hyse (Transaction Publishers, 1991), p. 563, fn. But then, as so often, this commentator goes off on the less fundamental problem - outsourcing - but in the process, brings up points relevant to the more fundamental problem of downsizing -]
    I hate to seem cold, but as far as I'm concerned, there are plenty of jobs that foreigners can have \such as\ pumping gas..., assembling Happy Meal toys..., filling snow globes with whatever that clear liquid is..., creat[ing] those flexible phosphorescent light sticks.... [Kirn ignores the fact that all these jobs can be done by robots]
    But when Asians [or robots?] start doing our good jobs, it's another story. According to company executives, IBM is considering shifting white-collar positions to India, where a competent novice computer programmer costs $5,000 a year instead of $60,000 [for a U.S. novice? try $30-35,000 max]. Such a move would help keep the firm competitive and mean lower prices for consumers.
    [Then he zeroes in on the nub of the issue -]
    But which consumers, you might ask. Laid-off IBM managers? I wish the [presidential] candidates would address this paradox instead of recycling rah-rah capitalist nostrums and nostalgic tariff schemes: At what point does "remaining competitive" dry up...the disposable incomes being competed for?
    [The process of drying up consumer spending power began at a point some years in the past. Then he flirts with the idea of makework -]
    Maybe a redefinition of "work" is called for, so that the term will no longer refer to making things...but only to buying and using them up - tasks we still excel at. Maybe Americans should be paid consumers, retained by China to absorb the output of the factories that closed here and opened there but won't be able to stay in operation unless the American workers who got canned can purchase the things they no longer get paid to make. How about a Marshall Plan for Cleveland financed by Beijing?
    [Somehow, we don't think the poor, Third-World Chinese have the money to pay support a parasitic but still First-World America. But at least he's addressing the problem of the need for greater circulation of profits and greater plowed-back 'investment' in one's own markets. Keynes half-facetiously spoke of paying half the population bury bottles of money and letting the other half dig them up and spend the money (General Theory, chap.10, sec.VI). Kirn is sort of reinventing the wheel of demand-side economics, after years of simpletonian supply-side economics. Isn't it time we moved on to 'balance-side economics'? - where supply and demand are automatically balanced by a system that automatically delivers full employment by sharing, with a reasonable (referendum-set) range, the vanishing work?]
    If the work that remains when the money washes away mostly involves swabbing toilets at Dunkin' Donuts, even full employment will be no blessing.
    [Even it won't remain once someone programs robots to do it. We already have high-tech Toto toilets from Japan that will do everything for your posterior except tie a bow around it - yet they are vulnerable, of course, to electricity blackouts.]
    Yet the mantra never changes: more jobs, more jobs. But what jobs, and paid for out of whose accounts?...
    [We won't get past this spot on the broken record until we change the mantra from straining to create "more jobs, more jobs" to easily sharing the jobs we already have - even dissolving the "job" limitation of a 40-hour workweek and just sharing the whole fixed "lump" of work. It's not even a fixed "lump" any more; it's a drying-up pool, a diminishing offering of market-demanded employment in the form of billable hours. It's time to cut the crap about job creation, which has always turned out to be too little too late over the last two centuries, and just share the vanishing work.]

Click here for downsizing stories in -
May/2003 (+Jun.1-2).
Jan. 16-31/2002.
Jan. 1-15/2002.
Dec. 16-31/2001.
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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