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Companies That Should Lay Off 10,000 This Year
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The evidence that sales at many companies are struggling and that
employment will suffer are almost everywhere. Several large companies will
almost have to cut employment. Most are industries which are already in
trouble. This is the 24/7 Wall St. list of companies that will have to cut
jobs, probably over 10,000 in each case, to make ends meet or improve
earnings between now and the end of 2008.
Next: Sears
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
b..
Sears
Sears
Sears is still one of the largest employers in the US, with well over
300,000 workers. It has not made any large cuts to its workforce, yet.
Housing, food, and gas prices are catching up to the people who shop at
Sears and K-Mart. Same-store sales are dropping and whatever bump the
company may have gotten from tax rebates is behind it. Sears cannot afford
its current expense structure and one of the few places it can make big cuts
is in people.
Next: Citigroup
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
c..
Travis Lindquist, Getty Images
Citigroup
Citigroup CEO Vikram Pandit has promised to cut expenses at the financial
services company. In one cut, Citi let 17,000 people go last year. But, that
is not going to reach the firm's goal of taking out $15 billion in
expenses.
Citi has 350,000 employees. Pandit has not sold off any major divisions and
has already been criticized by many for not cutting enough weight from the
start of his tenure. That leaves him with limited options for bring down
expenses.
Next: WaMu
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
d..
Marianna Day Massey, ZUMA Press
Washington Mutual
Shares in Washington Mutual trade as if the mortgage company many not make
it. The stock is at $4.40, near a 52-week low and well down from its period
high of $39.25. Mortgage defaults are still rising and home sales still
falling. WaMu may have to cut more people in its retail bank, brokerage and
mortgage businesses. Dropping another 10,000 people would be a horrendous
cut, but it may be necessary for the firm's survival.
Next: Rite Aid
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
e.. Rite Aid
Carolyn Kaster, AP
Rite Aid
Rite Aid is a dog of a company. It recently traded into penny-stock land,
falling to $.98, off of its 52-week high of $5.20. Same-store sales rose
1.1% last month, under Wall St. projections. Rite Aid has almost $6 billion
in debt. In the quarter ending May 31, the firm lost $157 million on $6.6
billion in revenue. Interest expense was $118 million. Rite Aid has 5,000
stores and 113,000 "associates." With such a large debt load, Rite
Aid needs
to cut a large number of people.
Next: AT&T
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
f.. AT&T
AP
AT&T
AT&T would seem like an odd candidate to cut 10,000 or more people.
AT&T
has over 310,000 employees and, while some of its business, especially
cellular, are growing fast, its landline business is shrinking. AT&T's
adjusted operating expenses for the second quarter of 2008 totaled $23.1
billion, versus $22.7 billion in the same period last year. So, as it loses
residential phone customers it will likely want to cut costs. Wireline voice
revenue dropped almost 8% in the latest period to $9.8 billion.
Next: Circuit City
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
g.. Circuit City
Steve Helber, AP
Circuit City
Circuit City is as close to being insolvent as almost any large public
company in the US. Circuit City has a market cap of $325 million which means
it trades at an astonishingly low 3% of revenue. The stock hit a 20-year low
late last month. CC may be sold. If another retailer buys it, the
consolidation of stores will mean lost jobs. CC could enter Chapter 11. That
could also trigger lay-offs. If the company wants to stay independent, it
will have to admit it has too many outlets.
Next: The Gap
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
h.. The Gap
Sion Touhig, Getty Images
The Gap
Gap's August revenue was down 5% to $1.24 billion. Comparable store sales
were off 8%. As the recession deepens, those numbers are not going to get
better. Gap's flagship stores in the US and overseas are doing relatively
well. Gap operates a total of 3,100 stores across its three brands and has
150,000 employees. Gap has already announced a strategic review to
consolidate some of its Gap brand locations, which may spells more layoffs.
Next: Merck
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
i.. Merck
Daniel Hulshizer, AP
Merck
Merck's current generation of drugs are under siege, some because they
will go "off patent" and others because of FDA troubles. The Big
Pharma
operation has managed to get its shares near a 52-week low at $34.50. That
is down from a period high of $61.62. Merck still faces some level of risk
from suits involving its drug Vioxx. Merck has 60,000 employees. It will
have to do with a lot less.
Next: AIG
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
j.. AIG
Robert Nickelsberg, Getty Images
AIG
AIG's new CEO Robert Willumstad say that things are so bad at the big
insurance firm that "everything is on the table". That probably
includes a
fair number of the company's 116,000 people. AIG plans to bring in $15
billion in new capital. It has managed to lose more than that over the last
three quarters. Press reports say that AIG is actively considering
spinning-out is worst assets. That should mean a lot of jobs related to
operating those parts of the company will be gone.
Next: Blockbuster
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
k.. Blockbuster
Craig Mitchelldyer, Getty Images
Blockbuster
Blockbuster is Wall St.'s perpetual whipping boy. Renting movies in
stores
is old world. The stock trades for $2.30. That is 10% of where it sat five
years ago. In the last quarter, BBI lost $42 million on revenue of $1.3
billion. Blockbuster has 7,600 stores. If Blockbuster is ever going to post
meaningful profits again it will have to continue cutting stores and
staffing. As the stock moves closer to $2, the decision becomes easier.
Next: IBM
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
l.. IBM
Tim Boyle/Getty Images
IBM
Why would IBM, one of the world's most successful technology companies,
ever cut staff? To save money. There were rumors over a year ago that the
firm would lay-off 150,000 people and bring them back as consultants or move
the jobs to Asia. IBM may not cut 10,000 worldwide, but it is a good bet
that a lot of jobs will be sliced in the US. Most of that work is going to
India.
Next: Ford
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
m.. Ford dealership
David Zalubowski, AP
Ford
August car sales at Ford fell by 26% to just over 155,000 units. The
company said the second half might be worse than the first. Ford promised to
cut production for the balance of 2008. Ford is running low on cash and its
credit ratings have been dropped due to rising default risks. Once it has
switched its product mix to fuel-efficient models, it still have to deal
with Toyota and Honda who own that end of the market.
Next: More From AOL
More From 24/7 Wall St.:
Read the Full Layoffs Article
Famous Brands for Sale
8 Big Retailers at Risk of Closing Doors
n..
More on AOL:
10 Most Unusual CEOs
There's your average CEO -- you know, type-A and relentlessly focused on
the bottom line or stock performance -- and then there's your, shall we
say,
slightly unusual CEO. For every Warren Buffett, there's a Patrick Byrne.
For
every Steve Jobs, there's a Larry Ellison.
Click through our gallery to see Minyanville.com's profiles of 10 CEOs
who’ve
gone wild, or at least, further afield than your average chief executive
officer.
First Up: Abercrombie's CEO
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