Siemens Cutting 16,750 Jobs
Industrial conglomerate Siemens says it is cutting 16,750 jobs worldwide because of the slowing economy. The cuts amount to 4.2 percent of its global work force.
The Munich-based maker of trams and wind turbines said Tuesday the cuts will include 12,600 mostly administrative jobs, along with another 4,150 positions in a restructuring in some of its units.
The company has a worldwide work force of approximately 400,000 people.
Siemens said it will consolidate its businesses from the current 1,800 separate legal entities to fewer than 1,000 and take its 70 regional companies and transform them into 20 regional clusters.
Siemens said the cuts were being made in an effort to reduce total costs by $1.8 billion by 2010.
“The speed at which business is changing worldwide has increased considerably, and we’re orienting Siemens accordingly,” said chief executive Peter Loescher in a statement announcing the cuts, which had first been raised last month.
“Against the backdrop of a slowing economy, we have to become more efficient,” he said.
Shares of Siemens were up 1.3 percent to $110.31 in Frankfurt trading after the announcement.
Siemens said it was considering offering employees transfers to other companies and early retirement packages in a bid to avoid forced layoffs and dismissals.
Loescher said Siemens was conferring with unions and labor representatives on the matter and that it wanted to make the changes rapidly.
“We want to begin negotiations with the employee representatives quickly in order to make the cuts in a way that will be as socially responsible as possible,” chief financial officer Siegfried Russwurm said. “Only as a last resort will we terminate employment contracts for operation reasons.”
The announcement comes even as Siemens has faced a corruption and bribery scandal that emerged in 2006. The company has acknowledged dubious payments, totaling up to $2.04 billion, which were allegedly used by the company to secure business.
The company said it would also reduce costs further by cutting back expenditures for information technology infrastructure and consultants, and the recent streamlining of its management structure and divisions.
Source: CNN.
0