Selected Reading
Publicly Announced Layoffs for Februrary1999
Feb. 3, 1999
Qualcomm Lays Off About 700 EmployeesWireless communications company Qualcomm Inc, has laid off about 700 employees as part of a broader cost-cutting plan. Most of the job cuts hit the San Diego-based company's money-losing wireless infrastructure business, and about 220 of the affected positions are held by temporary employees, the company said. In addition, 250 employees from the infrastructure division were "redeployed" to other divisions. Qualcomm said it will incur a one-time charge of as much as $20 million in the current quarter. Qualcomm, which has grown rapidly over the last few years, will have 10,500 employees when the cutbacks are complete. Qual- comm shares fell 75 cents to close at $62.63 on Nasdaq.
Feb. 4, 1999
Goodyear Plans to Cut as Many as 2,800 JobsAKRON, Ohio-Goodyear Tire & Rubber Co., the biggest U.S. tire maker, said Wednesday that it will cut up to 2,800 jobs, about 3% of its work force, as it moves to revive profit and combine with Japan's Sumitomo Rubber Industries Ltd.
Goodyear also said profit fell 35% in the fourth quarter to $115 mil- lion, or 74 cents a share, as a decline in costs failed to offset falling tire prices and slackened demand from Asia and Latin America. Revenue fell 1.5% to $3.22 billion. The results, which exclude one-time items, beat estimates by I cent.
Goodyear said it will take a restructuring charge of $100 million to $150 million, the amount it expects to save each year from the cuts. About 1,300 jobs will be cut at its Gadsden, Ala., plant; tire production will be shifted to other U.S. facilities.
Production also will be reduced at several plants in Asia and Latin America, where weakening demand for tires was partly to blame for a 36% drop in Goodyear's fourth- quarter profit.
The Sumitomo deal would create the world's largest tire maker, allowing Akron, Ohio-based Goodyear to save money by reducing jobs and prices for raw materials.
About 200 workers are expected to remain at the Gadsden plant, which opened in 1929. Workers who lose their jobs will be given preference when applying at other Goodyear plants, the company said.
Its stock ended up $1.63 at $52 on the New York Stock Exchange.
Feb. 5, 1999
Amoco will cut 1,500 Chicago-area jobs
BP Amoco said it expects to cut 1,500 management and non-management jobs in the Chicago area in the next 18 months, eliminating almost one in four positions.
The move stems from the merger of British Petroleum Co. and Amoco Corp. last year and from the continuing slump in world oil prices, the company said Thursday.
Most of the cuts will be at the company's downtown Chicago skyscraper, the former Amoco headquarters.
The London-based conglomerate said the majority of those losing jobs will be gone by the end of April. But a few decisions won't be made until early 2000, said BP Amoco spokeswoman Vicky Kastory.
At the same time, the company promised that 200 jobs will move to Chicago over the next 18 months, and it pledged to make Chicago the world headquarters for its chemical operations, which would bring more jobs.
The announcement comes six months after the company suggested that the merger would result in Chicago gaining jobs. But continuing low energy prices have helped turned an expected gain into a loss, the company said.
"We've been struck by a continuation of low worldwide oil prices. There will be some job reductions as a result of reduced spending (and) as a result of low energy prices," Kastory said.
BP Amoco employs close to 6,300 people in the Chicago area
Feb. 6, 1999
Toshiba to Close Calif. Semiconductor PlantToshiba Corp., the Japanese electronics company, said it will close a California semiconductor plant and cut 250 workers so it can move operations to more efficient plants in Japan. The plant in Sunnyvale, south of San Francisco, assembles prototypes of specialty chips that are used in a wide variety of electronic devices. It will start to shut down later this month and will be completely closed by June, Toshiba said. Some workers wilt be transferred to other Toshiba operations, if possible, the company said. The plant is part of Toshiba America Electronic Components Inc., a unit of Tokyo-based Toshiba Corp. (Bloomberg News)
Feb. 10, 1999
SmithKline Selling 2 U.S. Medical UnitsLONDON-Drug giant SmithKline Beecham is selling its U.S. pharmacy-benefits and clinical-lab businesses for nearly $2 billion and plans to cut 3,000 jobs, or 5.2% of its work force, within four years.
SrnithKIine Beecham Chief Executive Jan Leschly said Tuesday that the sales reflect the company's desire to focus on its pharmaceutical and consumer health-care businesses.
The company also announced a restructuring that will cost $750 million through 2002 and yield $200 million in annual savings afterward.
The changes will lead to the loss of 3,000 jobs by the end of 2002, most of them in manufacturing operations, the company said. SmithKline currently employs about 58,000 people worldwide.
Feb. 12, 1999
TWA Will Shut Down L.A. Reservation CenterTrans World Airlines is set to phase out 400 jobs in Los Angeles when it closes its only reservations center on the West Coast in June, the company said Thursday.
Airline spokeswoman Julia Bishop said the glass-and-concrete building, which dates to the 1960s and is just west of downtown, was too old and cost-prohibitive for the company's ambitious remodeling and upgrading efforts underway at its three other reservations centers in St. Louis, Chicago and Norfolk, Va.
'"We don't need an extra reservations center," Bishop said. "The other three we have will meet our needs."
Employees affected by the June 15 closure will be offered jobs within TWA, primarily at the company's remaining reservations facilities.
Workers were not available to comment Thursday and security guards kept a sharp watch on all strangers milling around the gated facility on the eastern fringe of the Westlake district near MacArthur Park.
Those unwilling to relocate will not be guaranteed replacement jobs in Los Angeles, Bishop said. "If there's a job opening available in Los Angeles and the employee is qualified for it, they're welcome to apply for it."
Those who don't accept a transfer will be given a severance package or "furlough" pay, Bishop said, and will be offering free job counseling services.
The amount of the severance packages will depend on each employee's position and seniority. Figures on TWA's total work force in Southern California were not immediately available Thursday.
"Basically, it's going to save us money to close it," Bishop said from TWA's St. Louis headquarters. "The building is completely in need of remodeling."
The three-story facility at 1543 Shatto St. has been home to a fourth of TWA's nationwide telephone reservations system since 1972.
The company has reservations facilities in Norfolk and Chicago and plans to overhaul the St. Louis facility later this year.
"During 1999, TWA must make significant reductions in unnecessary overhead expense, particularly in the area of excess facilities," Gerald Gitner, TWA chairman and chief executive, said in a prepared statement. "Consolidating our reservations function into three offices is a significant step in the process."
Gerald Whitehead of Morgan Adams Inc., which leases the building to TWA, said his company has not been formally notified of the airline's decision.
As part of its improvement efforts, Bishop said, the company is installing a new computer system that will shorten the time operators need to make bookings.
Feb. 17, 1999
Heinz to cut up to 4,000 jobsPITTSBURGH - H.J. Heinz Co. today announced plans to eliminate between 3,000 and 4,000 jobs over the next four years, sell its Weight Watchers diet classes and close factories to increase profits.
The company will concentrate on ketchup and six other core food products, including Ore-Ida potatoes and pet food.
The restructuring plan was presented to financial analysts today by William R. Johnson, Heinz's president and chief executive officer, at a meeting in Naples, Fla.
"It is regrettable that a necessary consequence of the restructuring process is a reduction of the global workforce,'' Johnson said.
The plan aims to generate more than $2.5 billion over four years to reinvest in Heinz brands, and $100 million to market products overseas.
The company will close 15 to 20 factories, shrink at least 10, and expand up to 15 to centralize manufacturing. Officials said they had not yet determined which factories would be affected.
Heinz currently has about 100 hundred factories and 40,500 employees worldwide, and earns $9.5 billion a year in sales. The Weight Watchers classes account for $400 million a year, spokesman Ted Smyth said.
Heinz's six core products are ketchup; frozen foods including Ore-Ida potatoes, Bagel Bites and Weight Watchers' Smart Ones dinners; tuna; soups and pasta meals; baby foods; and pet foods including 9-Lives and Kibbles 'n Bits.
Feb. 17, 1999
TWA Has Loss; Plans Job CutsST. LOUIS - Trans World Airlines will cut about 1,000 jobs and may make other cost-cutting moves this year, following a 10th straight year of losses.
The St. Louis-based carrier reported Wednesday that it lost $79.1 million in the quarter ending Dec. 31, bringing losses for the year to $120.5 million. TWA hasn't had a profitable year since 1988.
``We are not satisfied until we are earning consistent and reasonable profits,'' TWA chairman and chief executive Gerald Gitner said.
Neither was Wall Street. TWA shares were off 43 3/4 cents at $5.50 in afternoon trading on the American Stock Exchange.
The company will eliminate about 1,000 of its 21,200 jobs this year, mostly through attrition and voluntary severance, officials said.
Meanwhile, TWA will consider other cost-cutting moves, such as closing additional facilities, chief financial officer Michael Palumbo said. No details were provided on what facilities might be closed.
TWA blamed a big chunk of the fourth-quarter loss -- $42.6 million -- on special charges: $25 million to retire outdated 727s and DC9s; and $17.6 million to restructure operations in Israel, Italy and elsewhere, and to close its Los Angeles reservations office.
``Dealing with these issues is neither easy nor inexpensive,'' Gitner said. ``However, it is something that must be done.''
TWA was also hurt by a series of job actions last year, including a Christmastime ``sickout'' by flight attendants upset over stalled contract talks. The sickout forced dozens of flight cancellations. Officials would not speculate on how much money the company lost as a result.
Contract talks with the International Association of Machinists, which represents the flight attendants, are expected to resume next week.
The quarterly loss amounted to $1.30 a share and compared to a loss of $31.2 million, or 62 cents a share, in the fourth quarter of 1997.
Before extraordinary items, TWA lost 62 cents per share for the quarter. That was slightly better than analysts had projected.
For the year, TWA's loss amounted to $2.35 per share. Last year, TWA lost $110.8 million, or $2.37 per share.
But Juli Niemann of Huntleigh Securities in St. Louis said TWA's performance was cause for concern.
``The biggest problem we're facing with TWA is these are the best of times with airlines and they can't make any money,'' Niemann said.
Operating revenue for the fourth quarter was $747.1 million, down from $812.8 million in the fourth quarter of 1997.
For the year, revenue decreased to $3.26 billion from $3.33 billion a year earlier.
TWA received nine new aircraft in 1998 and finalized orders for 37 more for this year. The airline also announced plans for delivery beginning in 2000 of 125 Boeing and Airbus planes, with options for 125 more.
Gitner said that while financial results were disappointing, the company finished first among the major airlines in on-time performance as ranked by the U.S. Department of Transportation. The airline also reached agreement with pilots and Teamsters on new contracts.
Feb. 17, 1999
Wyman-Gordon to lay off 350 workersGRAFTON, Mass. - Wyman-Gordon Co., a manufacturer of commercial forgings and castings, is eliminating 350 jobs, or 8.8 percent of its work force.
David P. Gruber, chairman and chief executive, said in announcing the cuts Wednesday that the company expects to save $26 million because of the job cuts, discontinuation of product lines and the consolidation in its core aerospace structural, aerospace turbines and energy products businesses.
The company expects to charge $11 million against earnings as a result of the restructuring.
Wyman-Gordon, which had $753 million in annual sales last year, expects earnings to drop 7 percent in the third quarter due to a slowdown in customer orders for energy products because of Asian economic conditions and low oil prices, as well as seasonal fluctuations in demand.
The company, which employs 4,000, said it plans to minimize overtime and outsourcing expenses during the next quarter, as well as balance production more efficiently between its Scotland and Houston plants.
Feb. 18, 1999
Applied Graphics to slice staffNEW YORK - Applied Graphics Technologies Inc., a digital imaging services provider, announced Thursday it will lay off about 350 people, or about 10 percent of its work force, in a bid to boost its sagging earnings.
The company also said it lost $4.2 million, or 19 cents per diluted share, in the fourth-quarter after recording $8.9 million in charges largely associated with its restructuring, and said it expected its first quarter 1999 profit to fall below last year's result.
A year ago in the fourth quarter, Applied Graphics turned a profit of of $3.5 million, or 19 cents per share.
"Our 1999 first quarter results are expected to be below those of 1998 because the impact of the cost cuts we are making will not begin to take full effect until the second quarter," Fred Drasner, chief executive said. It said it has consolidated operations and closed 11 facilities primarily in the Midwest and New York Metropolitan area.
Applied Graphics said that problems at its Devon Publishing Group, which it acquired in 1998, will continue to impact revenue during the first quarter, but perform better by the end of 1999. In the first quarter last year, it earned $5.6 million, or 30 cents per share.
For the 1998 year, the Applied Graphics' profit fell to $8.2 million, or 39 cents per diluted share, from compared with $13.6 million or 83 cents per share in 1997.
The company released its fourth quarter results and 1999 outlook after the close of trading Thursday. Shares of Applied Graphics fell 56 cents to $9.50 on Nasdaq, which is down more than 84 percent from its 52-week high of $61.
Applied Graphics has struggled much of the year with disappointing earnings and twice previously in the past 12 months has warned Wall Street that quarterly results would fall short of expectations.
Feb. 19, 1999
Cone Mills to cut 650 jobs in restructuring planGREENSBORO, N.C. - Cone Mills Corp. will slash an additional 650 jobs - about 11.5 percent of its work force - as the denim maker tries to boost its earnings.
The job cuts, coupled with last month's decision to shut down its plant in Salisbury that employs 625 people, would leave it with about 5,000 workers.
Friday's cuts come in the wake of several restructuring moves by the denim maker, including merging its denim and sportswear fabrics businesses and laying off an unspecified number of white-collar workers in manufacturing and management.
Other cuts will come from the discontinuation of yarn manufacturing at the company's Cliffside and Florence plants in Rutherford County this spring, the company said.
"We deeply regret the impact that these changes will have on the lives of our displaced employees," said president and chief executive officer John L. Bakane.
"There is nothing that can be said to offset the painful impact of losing one's job," he said. "The only consolation that we at Cone Mills have is that the dedication and commitment of the new Cone organization to revitalizing the company will ensure the future security of our approximately 5,000 remaining employees and their families."
Last month, Cone Mills said it will shut down its Salisbury plant, which put 625 hourly and salaried employees out of work. It was the city's oldest cotton mill, opening in 1888.
Prior to the cuts, the company employed more than 6,000 workers at nine plants in North Carolina and South Carolina and a joint venture plant in Mexico.
February 22, 1999
Levi's Cuts 5,900 Jobs As Jeans Sales Slip
SAN FRANCISCO — Levi Strauss & Co., hit by poor sales of its world famous blue jeans, said Monday it will close 11 of its 22 North American manufacturing plants and lay off about 5,900 employees, or 30 percent of its work force in the region.The family-owned company said the closings are part of a series of strategic steps by its American division to improve its competitiveness by moving its manufacturing operations overseas, where labor costs are lower.
The move comes a week after Levi, one of the world's largest brand-name clothing makers, reported its sales fell 13 percent, from $6.9 billion to $6 billion last year, largely as a result of weak sales of jeans.
"Our strategic plan in North America is to focus intensely on brand management, marketing and product design as a means to meet the casual clothing wants and needs of consumers,'' said John Ermatinger, president of Levi Strauss, the Americas.
Also included in the layoffs will be about 100 employees at a finishing center in Brantford, Ontario, and about 80 employees who will lose their jobs when the company shuts down its U.S. transportation fleet this year.
Feb. 25, 1999
Philip Morris to Cut Production at Key Plant
Philip Morris Cos. said it will phase out cigarette production at one of its three main U.S. plants, resulting in the loss of up to 1,400 jobs. The company said it will record a pretax charge of about $200 million against earnings in the first half of 1999, principally to cover severance costs at its Louisville, Ky,, plant. Philip Morris, the world's largest tobacco company, said its Philip Morris Inc. unit will end cigarette output at the plant, which makes the Marlboro and other brands, because it is using only about half its capacity. Philip Morris shares fell 44 cents to close at $40.56 on the New York Stock Exchange.
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