Recession toll: 50,000 jobs lost in 1 day in US
It was a bloody Monday as the recession-racked US economy lost nearly 50,000 jobs. Among the companies that announced cuts on Monday were Pfizer, Texas Instruments, General Motors and Caterpillar, reports V Krishna.business Updated: Jan 28, 2009 01:18 IST
It was a bloody Monday as the recession-racked US economy lost nearly 50,000 jobs. And Tuesday wasn’t looking any better.
Among the companies that announced cuts on Monday were such big names as Pfizer, Texas Instruments, General Motors (GM) and Caterpillar.
Employees of GM in India will, however, not be affected.
“There are no layoffs in India this year. Instead, we are recruiting 500 people. We are currently outsourcing business worth $500 million out of India, which will be scaled up to $1 billion in two years. So far, we have invested $1 billion in India,” said P. Balendran, vice-president, corporate affairs, General Motors India.
Pharma giant Pfizer, which is buying rival Wyeth in a deal valued at $68 billion, said it would cut 8,000 jobs over three years.
Sprint Nextel, the third-largest cell phone carrier in the United States, will eliminate 8,000 jobs by the end of March. The company has been losing subscribers. Home improvement chain Home Depot said it is shutting down nearly four dozen specialty stores and cutting about 7,000 jobs.
Caterpillar, the world’s largest mining and construction equipment manufacturer, announced 5,000 new layoffs. The company might report its first quarterly loss since 1992.
Texas Instruments, which makes chips for cell phones and other gadgets, said it will cut 3,400 jobs because demand has slackened.
General Motors will cut 2,000 jobs at plants in Michigan and Ohio because of slow sales.
On Tuesday morning, high-tech glass and ceramics manufacturer Corning announced it will cut 3,500 jobs, or 13 per cent of its payroll. The reason: slumping demand for glass used in flat-screen televisions and computers. And then there are unannounced cuts.
The U.S. economy lost 5,24,000 jobs in December. A Labour Department report said, the total for 2008 was 2.6 million, the biggest drop since 1945. The unemployment rate rose to 7.2 per cent, a 16-year high. Economists say the worst is yet to come.
President Barack Obama was to visit Capitol Hill on Tuesday to lobby Republican leaders for his $825-billion stimulus package of spending and tax cuts. “We cannot afford distractions,” Obama said. “We cannot afford delays.”
Obama’s popularity dropped by 15 per cent though he has been in office less than a week. A Gallup poll showed Obama’s ratings drop to 68 per cent from 83 per cent.
The man charged with overseeing the recovery effort as Treasury Secretary, Timothy Geithner, finally won confirmation on Monday evening on a 60-34 vote in the Senate. He was sworn in by Vice President Joe Biden as Obama watched. “You’ve got your work cut out for you,” Obama said.
Job losses were reported on Monday from Europe too. Philips is cutting 6,000 jobs after announcing its first loss for half a decade.