American Express cuts another 4000 jobs
19 May 2009 | 5673 views | 0
American Express is cutting around 4000 jobs - six per cent of its global workforce - as part of a programme aimed at reducing costs by $800 million this year.
The company says the job cuts will be across business units, markets and staff groups, saving around $175 million. They are on top of 7000 cuts announced in October as part of a re-engineering plan designed to save $1.8 billion in 2009.
The lay-offs will lead to a restructuring charge of between $180 million and $250 million pre-tax in the second quarter.
A further $500 million will be saved by reducing spending on marketing and business development. Slashing expenses for consulting and other professional services, travel, and general overhead will save around $125 million, says the firm.
Kenneth Chenault, chairman and CEO, American Express, says: "We believe these efforts will put us in a better position to remain profitable and free up some additional resources that will be reinvested in the business to make sure we can take competitive advantage of opportunities as the economy begins to rebound."
Last month the company reported a 56% fall in first quarter net income as the recession and rising unemployment hit consumer spending and provoked customer defaults.