Tag: Lay offs

Off With Their Heads: Fixing Failing Companies

Time after time we see layoffs as the solution to a company’s woes.  For example, of the 598,000 newly unemployed individuals in the US in January of 2009, 163,000 of these were laid off from the 500 largest US companies.  Some lowlights:

Jan. 26: Following the acquisition of the small drug outfit Wyeth for $68 billion, Pfizer closes five factories and cuts 15% of total workforce (19,000 workers).

Jan. 26: Sprint Nextel pink-slips 8,000 workers–recording more than $300 million in severance charges but saving $1.2 billion a year in labor costs.

Jan. 30: Caterpillar increases previous layoffs from 20,000 to 22,110, and share price hits 52-week low.

Here’s the question: does this really help a company?

Here’s the answer: probably not.

Another question:  what would help these companies?

Another answer: replace the management!

We’ve heard some whining about President Obama forcing out GM CEO Waggoner.  Maybe he’s onto something?