EMC To Cut 2,400 Jobs:
EMC Corp. said late Wednesday it plans to lay off 2,400 people worldwide amid broad cost-cutting measures at the Hopkinton, Mass., IT giant.
The company, which has hundreds of Triangle workers, said it is looking to cut costs in its core information infrastructure business by about $350 million in 2009 and a total of $500 million by 2010. The restructuring program will consist of consolidating “back-office functions” and offices, reduction of management layers, rebalancing of investments toward higher-growth products and markets, and reduction of spending on contractors, third-party services and travel.
The layoffs make up about 7 percent of EMC’s 34,000 employees and will be spread equally among employees in the United States and abroad, said EMC spokesman Michael Gallant.
Diversified mining giant, Teck Cominco (TSX & NYSE: TCK) said it would cut about 1,400 positions, or 13% of its global workforce as part of a cost cutting strategy to help it head off weaker commodity prices. Teck Cominco has been particularly hard hit as it has considerable exposure to base metals, including zinc, which have witnessed some of the most savage drops of all commodities.
The job cuts are expected to save the company around $85 million per annum, but would take a one-off hit of $35 million in the first quarter for severance pay and other associated costs to the workforce reduction. In the same announcement, Teck Cominco said it planned to cut its coal production in 2009 by around 20 million tonnes to take into account weaker demand from the global steel sector. At the height of the commodity boom, Teck Cominco acquired Fording Canadian Coal trust, mostly with debt financing.
Job losses are global, and China is not immune; Lovono Cuts Jobs Restructures:
HONG KONG (Reuters) - Lenovo Group, the world's fourth-biggest PC maker, forecast a quarterly loss as China's slowing economy hit sales, and said it will axe 2,500 jobs as part of a restructuring to cope with falling demand for computers.Macy's Will Shutter 11 Stores In 9 States:
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The company said it would consolidate its China and Asia Pacific organizations into a single Asia Pacific and Russia (APR) business unit, and will cut executive compensation, including merit pay and long-term incentives, by 30-50 percent.
NEW YORK (AP) — Department-store operator Macy's Inc. said Thursday it will close 11 underperforming stores in nine states — affecting 960 employees — and lowered its forecast for the fourth quarter after one of the weakest holiday seasons in years.
Stores slated to close include locations in Los Angeles, West Palm Beach, Fla., Nashville, Tenn., and St. Louis, among others. Cincinnati-based Macy's Inc. says the closures will cost about $65 million, most of which will be booked in the 2008 fourth quarter.
Walgreen to Cut 1,000 Jobs, or 9% of Work Force To Save $1billion:
Walgreen Co. is eliminating about 1,000 jobs, or about 9% or its work force, as the nation's No.2 drugstore chain continues to rein in costs amid a cutback in consumer spending and increased competition.
The company said it is offering early retirement and severance incentives to some of the corporate and support employees in an effort to reduce the number of layoffs set to start next month.
U.S. Jobless Benefits Program Swells to 4.6 Million:
Jan. 8 (Bloomberg) -- The number of Americans collecting unemployment benefits surged to a 26-year high as the labor market worsened in a yearlong recession.
Initial jobless claims unexpectedly fell by 24,000 to 467,000 in the week that ended Jan. 3, the lowest level in almost three months, the Labor Department said today in Washington. The total number of people getting benefits rose a week earlier to 4.6 million, the most since 1982.
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December Jobs
The government may report tomorrow the economy lost another 510,000 jobs in December, bringing the 2008 total to a six- decade high of 2.4 million, according to economists surveyed by Bloomberg. The unemployment rate probably jumped to 7 percent, the highest level since 1993.
Economists surveyed last month projected the rate will climb to 8.2 percent by the end of 2009, signaling job cuts are likely to keep rising. Martin Feldstein, a Harvard University professor and former adviser to President Ronald Reagan, yesterday predicted during an interview on Bloomberg Television that the jobless rate may eventually exceed 10 percent.
In excerpts of the speech due at 11 a.m. Washington time, Obama warned that without immediate steps by the government to revive the economy, family incomes will drop, the unemployment rate could reach “double digits” and the U.S. risks losing a “generation of potential and promise.”
Obama has pledged his plan will save or create 3 million jobs over the next two years.
Moving Average
The four-week moving average of claims, a less volatile measure, fell to 525,750 for the period ending Jan. 3, compared with 552,750 the prior week, today’s report showed.
Obama plans to "save" the economy by creating 3 million new jobs by pouring money at roads, bridges and schools. This is not to say the efforts will be in waste, and these are areas that need attention as our infrastructure ages, but these projects will most likely be at prevailing wages and employers will grumble as they are forced to deal with contractors at these bloated wage levels.
Furthermore, 2.4 million jobs have been lost and 4.6 million are being federally subsidized to produce nothing. By the time Obama gets his plan to create 3 million jobs, 3 million will have already been lost.
Wages, salaries and benefits were propped up on phony demand and flat out greed fueled by massive credit expansion. Mises spoke of this with his story of the master builder:
[A]dditional investment is only possible to the extent that there is an additional supply of capital goods available. . . . The boom itself does not result in a restriction but rather in an increase in consumption, it does not procure more capital goods for new investment. The essence of the credit-expansion boom is not overinvestment, but investment in wrong lines, i.e., malinvestment
. . . on a scale for which the capital goods available do not suffice. Their projects are unrealizable on account of the insufficient supply of capital goods. . . . The unavoidable end of the credit expansion makes the faults committed visible. There are plants which cannot be utilized because the plants needed for the production of the complementary factors of production are lacking; plants the products of which cannot be sold because the consumers are more intent upon purchasing other goods which, however, are not produced in sufficient quantities.The observer notices only the malinvestments which are visible and fails to recognize that these establishments are malinvestments only because of the fact that other plants—those required for the production of the complementary factors of productions and those required for the production of consumers’ goods more urgently demanded by the public—are lacking. . . . The whole entrepreneurial class is, as it were, in the position of a master-builder [who] . . . overestimates the quantity of the available supply [of materials] . . . oversizes the groundwork . . . and only discovers later . . . that he lacks the material needed for the completion of the structure. It is obvious that our master-builder’s fault was not overinvestment, but an inappropriate [investment].33
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