Top 10 Biggest Job Cuts U.S. Companies Made In 2012

By @moranzhang on
  • Surfboards lean against a wall at the Google office in Santa Monica

    In August, Google Inc (NASDAQ: GOOG) said it would cut 4,000 jobs from the 20,000-person work force of Motorola Mobility, the ailing cellphone maker that Google bought in May. The online search leader said then that two-thirds of the job cuts, about 20 percent of Motorola's staff and 7 percent of Google's overall work force, would take place outside the U.S. An Oct. 4 filing with the SEC suggested that might not be the end of the cutbacks. The Motorola restructuring is expected to grow to "include additional geographic regions outside of the U.S.," the Mountain View, Calif., company said.

  • MetLife

    Metlife Inc (NYSE: MET), the largest U.S. life insurer, said in January it will shut its home mortgage-origination operation. The move led to the elimination of most of the 4,300 workers who worked in that sector, and cost the company $90 million. About 20 percent, or 860, of the jobs were based in Irving, Texas, with the rest scattered throughout the nation.

  • Trading price for Morgan Stanley rolls across stock ticker on Morgan Stanley headquarters building in New York's Time's Square

    Banks all over the world have been in trouble and they have been shedding jobs in order to help keep themselves in the black. During a conference call with analysts in July, Morgan Stanley (NYSE:MS) Chairman and Chief Executive James Gorman said the firm's work force at year-end will fall 7 percent from 2011, reflecting previously announced layoffs as well as the firm's efforts in applying “a high bar for replacing attrition.” The forecast implies a reduction of more than 4,000 jobs from the firm's global headcount of 61,899 at Dec. 31, 2011.

  • A pedestrian walks with a shopping bag from a JC Penney department store in New York

    J.C. Penney Co. Inc. (NYSE:JCP), a once-favored destination for generations of middle-class shoppers, said on Jan. 25 it'll close 47 stores and cut about 5,500 jobs in a revamp of the struggling U.S. retailer. J.C. Penney's sales performance in recent years has lagged that of Macy's Inc. (NYSE:M) and Kohl's Corp. (NYSE:KSS). So far this year, shares of J.C. Penney are off more than 44 percent.

  • Tide detergent, a Procter & Gamble product, is displayed on a shelf at a store in Tempe

    Procter & Gamble Co. (NYSE:PG), the maker of Tide detergent and Gillette razors, announced in November it plans to possibly cut more than twice as many non-manufacturing jobs as it had planned. On top of the plan already announced in February to cut 10 percent of its non-manufacturing jobs, or 5,700 jobs, by the end of its fiscal year in June 2013, P&G plans to continue to reduce its non-manufacturing jobs by 2 percent to 4 percent between 2014 and 2016. The top end of the job-cut projections would further reduce P&G's non-manufacturing workforce by an additional 5,900.

  • 9. PepsiCo

    PepsiCo Inc. (NYSE:PEP) announced on Feb. 9 that it expects to cut 8,700 jobs as part of a plan to save an extra $1.5 billion over the next three years, as it pours more money into its brands. The maker of Pepsi soda, Tropicana juice and Doritos chips said that the job cuts are 3 percent of its work force. The layoffs affect workers in 30 countries, with fewer than 2,000 of the cuts expected to occur in the U.S., where the Purchase, N.Y.-based company has some 100,000 employees. Pepsi's rival Coca-Cola Co. (NYSE:KO) announced in the same week its own cost-cutting program, although Coke said it would ultimately add jobs in its program.

  • Bankers Outside Citigroup

    Among the latest companies to announce job actions, Citigroup Inc. (NYSE: C) said earlier this month that it plans to eliminate 11,000 positions worldwide, as it seeks to shrink the size of its business and become more profitable. The cuts amount to about 4 percent of the bank's workforce and will save the bank as much as $1.1 billion a year in expenses. About 4,600 of Citigroup's planned 11,000 layoffs will be in North America, with the majority in the U.S. The cuts are Chief Executive Michael Corbat's first major steps to reorganize the company since he took the reins in October after directors pushed out his predecessor, Vikram Pandit.

  • American Airlines

    In February, American Airlines parent AMR Corporation (PINK: AAMRQ) said it will seek to cut 14,000 jobs and terminate pensions in pursuit of $2 billion in annual cost savings to compete with rivals. But by September that number had been whittled down to about 11,000 employees, who were advised they may lose their jobs by year-end. AMR filed for Chapter 11 protection from creditors in November 2011 and said it has been suffering from higher labor costs than its peers. Currently, American Airlines and US Airways Group, Inc. (NYSE: LCC) are reportedly moving closer to a possible merger.

  • Twinkies

    Hostess Brands is the second-largest source of job losses for 2012 so far, and has become a poster child for labor-contract negotiations gone wrong. The iconic maker of Twinkies and Wonder Bread said in late November that it would eliminate 18,500 jobs as it liquidates its assets and sells off its brands. Strikes crippled the company after it and the union representing some 5,600 bakers failed to reach an agreement during contract negotiations. “We simply do not have the financial resources to survive an ongoing national strike,” said Gregory F. Rayburn, the Company’s Chairman and CEO.

  • Hewlett-Packard

    It’s hard to top, or bottom, the recent mass firings by the ailing Palo Alto, Calif.-based tech giant Hewlett-Packard Company (NYSE: HPQ). HP announced plans in May to cut 27,000 workers, and then revised the total to 29,000 by 2014, equaling more than 8 percent of its workforce. HP has said that it will likely cut 11,500 jobs by the close of fiscal 2012, which ended Oct. 31. Chief Executive Meg Whitman, who took the top job last September, is trying to move the company past the internal upheaval that marked 2011, including the departure of two previous chief executives. Shares of HP are down about 45 percent for the year.

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Despite the faster pace of downsizing as the year comes to a close, the number of job cuts this year announced by U.S. employers is behind last year’s pace -- though it still stands at a staggeringly high level of 490,806 jobs (as of November 30).

Last month alone, U.S. companies announced plans to shed 57,081 workers from their payrolls. That was up 20 percent from the previous month and marked the third consecutive monthly increase, according to the latest report from consultants Challenger, Gray & Christmas.  Last month was only the fourth time this year that job cuts exceeded 50,000.

California, Texas and New York saw the most layoffs in 2012. For these mass layoffs, employers cited reasons ranging from cost-cutting to bankruptcy.

The recent surge in layoffs is at least partly attributed to the bankruptcy of private Twinkies maker Hostess Brands Inc. in November. That accounted for 18,500 of the jobs lost.

"Job cuts this year have really been driven by a handful of large-scale cuts," Rick Cobb, executive vice president of Challenger, Gray & Christmas, said in a statement.

Wall Street firms have been slashing staff since the second half of 2011 as the European sovereign-debt crisis and concerns about the global economy persist and weigh on client activity. Wall Street eliminated 300,000 financial services jobs in the last two years. And experts predict that more layoffs will be come in 2013.

The moderate growth in economic activity in recent months has also meant that payroll growth has been unspectacular but relatively steady, with gains averaging 157,000 per month over the 12 months ending in November.

While this was not as strong an increase as in the past two expansions, it has been enough to push the unemployment rate down at a pace faster than at any point in the previous expansion and about in line with the fastest one in the expansions of the 1990s.

“We believe this is in large part because of the retirements of the baby boomers, which our analysis indicates is the largest single force that has pushed the labor force participation rate down in recent quarters,” Dean Maki, chief U.S. economist at Barclays, wrote in a note. “This downward force on the participation rate means that fewer jobs are now needed to keep the unemployment rate steady.”

Maki estimates employment growth of 75,000 to 100,000 per month would be enough to keep the jobless rate steady. Job growth significantly above that tends to push the unemployment rate down.

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