AMEX cuts jobs once again
(20 May 2009 – Global) American Express (Amex) has announced another round of job cuts, this time cutting 4,000 jobs in another bid to cut costs amid rising defaults.
The credit card company said that a reengineering plan to be put in place will not only include a reduction in staffing levels, but also scaled back investment spending and further cutbacks in operating costs.
Amex will cut 4000 jobs, or six percent of its global workforce, as part of the programme aimed at reducing costs by US$800 million in 2009. The total benefit from the staffing reductions is expected to be approximately US$175 million.
A restructuring charge of approximately US$117 to US$163 million after-tax would be incurred in reducing the workforce.
Late last year, Amex announced that it would undergo a reengineering plan that was to cut US$1.8 billion in costs and 7,000 jobs, which was then 10 percent of its workforce.
Amex said that the new announcement was in addition to the $1.8 billion benefits tied to the reengineering plan announced in October 2008.
Todd Beavis, Amex spokesman, said that while Australia and New Zealand are not the main focus of the restructuring, reductions will occur.
The company is still working through the impacts of the global announcement and expect the number of positions affected locally to be far less than the six percent announced globally, Beavis said.
Last month Amex reported a 56 percent reduction in first quarter net profit due to reduced consumer spending and higher customer defaults.
Amex will cut 4000 jobs, or six percent of its global workforce, as part of the programme aimed at reducing costs by US$800 million in 2009. The total benefit from the staffing reductions is expected to be approximately US$175 million.
A restructuring charge of approximately US$117 to US$163 million after-tax would be incurred in reducing the workforce.
Late last year, Amex announced that it would undergo a reengineering plan that was to cut US$1.8 billion in costs and 7,000 jobs, which was then 10 percent of its workforce.
Amex said that the new announcement was in addition to the $1.8 billion benefits tied to the reengineering plan announced in October 2008.
Todd Beavis, Amex spokesman, said that while Australia and New Zealand are not the main focus of the restructuring, reductions will occur.
The company is still working through the impacts of the global announcement and expect the number of positions affected locally to be far less than the six percent announced globally, Beavis said.
Last month Amex reported a 56 percent reduction in first quarter net profit due to reduced consumer spending and higher customer defaults.
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