Job Cuts Mount as Global Economy Falters
By Gabriel Black
Global Research
January 22, 2016
Major corporations around the world announced sharp cuts in their labor forces this past week. The job reductions come amidst growing signs of a general economic crisis, as commodity prices and share values plummet.
Leading the way in job cuts are energy companies, particularly in the oil and gas industries, which have been hit hard by the collapse in oil prices.
Schlumberger, the largest oil technology and drilling company, announced Thursday that it would eliminate 10,000 positions, roughly ten percent of the firm’s workforce. The company’s stock has been trading at near four-year lows this past week. In order to please investors, the company announced the mass layoffs alongside a $10 billion stock buyback program to boost its stock price.
Royal Dutch Shell reported that it would increase its planned 7,500 job cuts this year to 10,300. The downsizing is bound up with Shell’s acquisition of the BG group, a smaller British oil company. The cut totals ten percent of the workforce of the merged companies. Other energy company cuts include Southwestern Energy Corporation (1,100), Noble Corporation (100), and Potash (430).
While job cuts have been sharpest in the oil and gas sectors, the general downturn in primary resources has soured profit forecasts and spurred layoffs throughout the economy.
The German Manager Magazin reports that Volkswagen is considering slashing up to 10,000 jobs as part of a new cost-cutting drive. In addition to the impact of the general tumult in the world economy, Volkswagen is reeling from the exposure of its rigging of car emissions. Volkswagen intends to place the burden of the scandal squarely on the backs of the workers, in part by increasing productivity by ten percent this year.
On Tuesday, health industry giant Johnson & Johnson announced 3,000 job cuts at its medical device division. That is about five percent of the firm’s global workforce. The company hopes to save $1 billion annually from the cut, which will be imposed over the next two years.
Pearson, the world’s largest education publisher, announced Thursday that it would shed 4,000 jobs, roughly 10 percent of its workforce. Many of these job cuts will fall in the company’s operations in the United States. The firm’s shares declined substantially after it announced three months ago that it would not make a profit in 2015. The firm is the co-owner of Penguin Random House.
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