Jobs, Jobs, Jobs

[OutletPass]

134,000 Lost Jobs in August 'Mass Layoffs'

By Kirstin Downey
Washington Post Staff Writer
Friday, September 26, 2003; Page E01


More U.S. workers lost their jobs in large layoffs in August, the Bureau of Labor Statistics reported yesterday, another sign that employers are continuing to trim payrolls even as the economy strengthens. The BLS tracks what it calls "mass layoffs," or firings of more than 50 workers in a single month by a single employer, by compiling reports on initial claims for unemployment benefits filed with state agencies. The numbers include temporary and permanent firings. About 134,000 workers lost their jobs in 1,258 mass layoffs nationwide last month, up from the 128,103 employees who were fired in 1,248 such actions in August 2002, the bureau said.

The mass-layoff report is a snapshot of monthly employment changes across the country. Manufacturing took the hardest hit of any sector in August, accounting for nearly a third of all mass layoffs and more than a third of the number of workers who lost jobs, the report said. Job losses were also reported in transportation equipment, textile mills, machinery and food manufacturing. California, New York, Illinois, North Carolina and Texas had the most mass layoffs, the report said.

[madape]

TO: All Sabre Holdings Colleagues
FROM: Bill Hannigan
9/24/03

The markets we serve are transitioning rapidly. We are in the midst of continued growth of online distribution channels, increasing price competition, the pending deregulation of the CRS industry, travel agency consolidation, structural change in the airline industry and, of course, aggressive competitors in all markets where we compete.

To successfully compete in such a price-charged environment it is essential that we stake out the low-cost-provider position. Competing from a low-cost position is competing from a position of strength. It enables us to aggressively go after new business and to retain existing business, while at the same time ensuring an appropriate level of profitability for future investments and for our shareholders. It also provides us with an important tool to squeeze our competitors.

While the need to be cost efficient is a requirement in every aspect of our business, the ante has been upped significantly with what has transpired across the GDS industry. Our GDS company, Sabre Travel Network, the world’s premier global distribution company, has led the way for years in customer satisfaction, product and market share. TN accounts for approximately 70 percent of our combined revenue and an even greater percentage of our earnings. With industry deregulation just around the corner we chose to lead the industry to a new pricing structure: a new pricing structure which re-invigorated the supplier value proposition, re-charged the travel agency channel and included the typical trade-off of price in exchange for content and term commitments.


This revised pricing structure and value proposition stabilizes the GDS business model, but it also necessitates a significant change in our cost structure since every penny of price discounting flows straight to the bottom line. The DCA 3-year contracts represent an effective discount of about 6 percent across our entire bookings base; 6 percent of price equates to over 30 percent of total company profits under our current cost structure.

It is incumbent upon us to respond to this fundamental change on the revenue line across the GDS industry and to simultaneously exploit our scale advantage to ensure industry cost leadership. Our TN team has won year in and year out; now the playing field and the rules have changed. I am confident we will win with the new rules and the new playing field, but it will be difficult for us in many ways, personally and professionally. Because TN is such a large portion of our TSG portfolio, the need to cut costs reaches well beyond TN and the TN org chart. It spans all of our support organizations.

As we work through our 2004 planning, we are looking at every opportunity to reduce our costs across TSG. This will include reducing our staffing levels. Some organizations will be impacted greater than others. We are finalizing 2004 plan decisions in the coming weeks and we would expect to complete these reductions before the end of the year.

I know this is a difficult process to go through, but it is imperative to our customers, shareholders and you that we take the steps needed to continue to position our company to be a strong competitor for the long term.


Regards,
Bill

------------------------------------------------------

Ever get one of these?

[MFFL]

I read that Levi was closing the last of their US and Canada plants. Very weird to know that an American institution will have all of its clothes made overseas.

[Murphy3]

MFFL, that's why i only wear Rustlers...Levi's a sellout

[Chiwas]

Manufacturing took the hardest hit of any sector in August,

We have to be very worried about this. The rest of the sectors depends largely on the manufacturing industry.

[EricaLubarsky]

Originally posted by: Chiwas

We have to be very worried about this. The rest of the sectors depends largely on the manufacturing industry.

Mexico is seeing manufacturing jobs evaporate too. It's a lot to worry about.

[madape]

It's really nothing to worry about, unless you work in the manufacturing industry. Cheaper manufacturing cost is a good thing for American businesses and American consumers. Cheaper manufacturing costs mean that finished goods can be sold at a cheaper price and a higher profit margin. The manufacturing industry, like the agricultural industry is a victim of it's own success. As we get more efficient at doing a job, the more automated it becomes, the less we have to rely on expensive labor. We can lower our personell needs and depend more on American made infrastructure costs such as software, microprocessors, and networks. Witness our record breaking levels of productivity this year. As we lower our manufacturing costs, we are becomeing a more productive society.

The point is that America will adapt. Those plant workers will find other jobs, more productive jobs, jobs that will help America grow. The investment money that went into the manufacturing plants will be go to more profitable investments, providing opportunities for new industries to emerge. Productivity will rise. GDP will rise. Quality of life will rise. We are already the most powerful economic power the world has ever seen. We'll become even stronger when we trim the fat.

[Chiwas]

Even when the madape's theoretical point is almost completely right, there is a factor that harms the postulate. The lost jobs aren't filled with savings, but with foreign cheaper goods.

And a job lost in manufacturing, replaced with a foreign good, means the lose of other 2 or 3 jobs in the services sector.

[WayOutWest]

You can remove tech jobs from the safe harbor. Alot of tech jobs, including software programming, is going overseas. To India in particular. Dell has moved their tech support to India and alot of software jobs I bid on are getting undercut by companies with programmers from India. They produce an inferior product but it can be made to work durring commisioning, that's where I'm getting alto of work right now, fixing crap software from overseas. It ends up costing the same in the long run but it looks alot better durring the budgeting phase of a project. Software programming USED to be one of those sectors that seemed safe from being undercut by cheap foreign labor. Props to them but it's hurting tons of people in my area (SoCal).

Telecom, chip manufacturing and networking are getting hammered as well. Being a Cisco certified engineer USED to be a winning Lotto ticket, now they're really hurting and having to go back to school and pick up more "soft" skills. Even launching space payloads has become competitive, the US USED to be the ONLY game in town, now the Chineese are having alot of success in that field, mostly due to US rockets blowing up. I worked on a project for special transport for rockets and rocket components and all my customer ever talked about was the FORMER US monopoly.

It's tough all around and doesn't seem to be getting better.

[ames7]

I really hope it gets better soon. I am so worried about trying to find a job after college. I graduate next year & I was really hoping to get some experience, but now I'm beginning to think maybe I should just go straight to grad school. It's hard to even find a part-time job now.

[LRB]

What's really weird is at my work all I hear is how hard it is to find people. They offer huge bonuses for employee referrals and it takes forever to get someone new in. They pay great and were voted one of the 10 best places to work in DFW. I just don't get it, but glad I've got a position there even if it is only as a contractor for now.

[southern_sweets]

I've had a similar experience LRB. Except the bonus part. Darn!

And, I'm actually ok with the contractor part since I've gotten a call about every 10 days about another contract job. Hopefully someone else is getting the positions I'm turning down.

It is a little scary the positions that are moving overseas, especially the high tech jobs. It's one thing to see the manufacturing move elsewhere, but when skilled and educated workers lose their jobs it's a bigger red flag IMO.

[BASKETBALL 101]

Originally posted by: LRB
What's really weird is at my work all I hear is how hard it is to find people. They offer huge bonuses for employee referrals and it takes forever to get someone new in. They pay great and were voted one of the 10 best places to work in DFW. I just don't get it, but glad I've got a position there even if it is only as a contractor for now.

LBR, where do you work?

[sturm und drang]

I work in advertising, and I know many people consider my field to be a good indicator for the state of the economy. Anecdotally, I can tell you that business is great for us right now. We actually refused to take any new business this summer because we had too much work and thought scaling quickly to meet new demand would impact the quality of our work.

So if you consider advertising a good indicator, I can tell you that things are looking better...

[aexchange]

Originally posted by: WayOutWest
You can remove tech jobs from the safe harbor. Alot of tech jobs, including software programming, is going overseas. To India in particular. Dell has moved their tech support to India and alot of software jobs I bid on are getting undercut by companies with programmers from India. They produce an inferior product but it can be made to work durring commisioning, that's where I'm getting alto of work right now, fixing crap software from overseas. It ends up costing the same in the long run but it looks alot better durring the budgeting phase of a project. Software programming USED to be one of those sectors that seemed safe from being undercut by cheap foreign labor. Props to them but it's hurting tons of people in my area (SoCal).

the consulting company i work for is also contracting business overseas to india on a trial basis. we'll see. but my company is hiring pretty aggressively right now, so it may just be a test run. much of the business we do requires human interaction, and i just don't see indian contractors being able to replace what we bring.

[LRB]

Originally posted by: BASKETBALL 101

LBR, where do you work?

Check your PM's.

[u2sarajevo]

You know, the tech industry jobs being off-shored to India is happening at a ridiculous pace. I work for a Consulting firm and we have bid requests where at least 60% of the work has to be off-shored. That has become standard practice over the last year, year and a half.

If this continues, I have a feeling Congress is going to have to pass something that gives businesses incentive with staying American. Either that, or India is going to become America's Tech sector.

[img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img]

[Chiwas]

[Chiwas]

The CEO was scheduled to speak at an important convention so
he asked one of his employees, Jenkins, to write him a punch,
20-minute speech. When the CEO returned from the big event,
he was furious.

"What's the idea of writing me an hour-long speech?", he
demanded. "Half the audience walked out before I finished."
Jenkins was baffled. "I wrote you a 20-minute speech," he
replied. "I also gave you the two extra copies you asked
for."

[dallas_esq]

Originally posted by: u2sarajevo
You know, the tech industry jobs being off-shored to India is happening at a ridiculous pace. I work for a Consulting firm and we have bid requests where at least 60% of the work has to be off-shored. That has become standard practice over the last year, year and a half.

If this continues, I have a feeling Congress is going to have to pass something that gives businesses incentive with staying American. Either that, or India is going to become America's Tech sector.

[img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img] [img]i/expressions/face-icon-small-mad.gif[/img]

Do you really think Congress will pass such a law? I'm afraid the latter will happen if those are the only two possible outcomes.

I hear people are doing pretty well. I see an increase in poverty though. We've all got to get on this global market bus as soon as possible.

[u2sarajevo]

Originally posted by: dallas_esq

Do you really think Congress will pass such a law? I'm afraid the latter will happen if those are the only two possible outcomes.

I hear people are doing pretty well. I see an increase in poverty though. We've all got to get on this global market bus as soon as possible.

Heck if I know. I don't claim to be an expert on Government issues, but I know that something should be done. I do have a feeling that once the product coming out of India is comparable to what we produce in the States that the cost will start to rise for the off-shore jobs. But it sure is frustrating watching the Tech sector being hurt like that. I wish there was a Sam Walton running the Tech industry. [img]i/expressions/face-icon-small-happy.gif[/img]

[madape]

Here's an interesting article about a certain local company that has done layoffs 6 years in a row despite posting healthy profits and posting a dynamite cash position.

http://www.dfw.com/mld/dfw/business/6904798.htm

[Chiwas]

From the article:

During the same time, Hannigan received a bonus every year. He was paid nearly $1.5 million in bonuses, which totaled more than 70 percent of his base salary.

CEOs don't usually get compensated for creating more jobs or punished for destroying them.

Maybe that's part of the problem.

Loud and clear.

[LRB]

Originally posted by: u2sarajevo

Heck if I know. I don't claim to be an expert on Government issues, but I know that something should be done. I do have a feeling that once the product coming out of India is comparable to what we produce in the States that the cost will start to rise for the off-shore jobs. But it sure is frustrating watching the Tech sector being hurt like that. I wish there was a Sam Walton running the Tech industry. [img]i/expressions/face-icon-small-happy.gif[/img]

Actually, I wouldn't worry about a large number of IT projects being outsourced to India or any place for that matter. I've been in IT for over 12 years and have worked with a large variety of companies fromt he very small to the Fortune 50 and one thing that almost all them have in common is that they are not organized enough to outsource a lot of their IT projects. There may be a few exceptions, but for the large majority this just wouldn't work. The trouble is that they can't give you the details of a project before the project starts most of the time. To effectively outsource you really need this.

Another issue is the communication factor. India is night and day different from here, and I'm speaking time zones. This poses lots of communication problems. I've worked on some projects involving India where we had to have someone come in at 3 AM to support a Internet conference call we were having in the afternoon. Then you have the language and culture barrier. Hard enough to communicate with people with people who speak the same language and share the same culture. Finally communication is not the same when not done in person. Teleconferencing has come a long way, but it still has major problems.

There will be some projects that throwing them over the wall to India will make great sense. But for the vast majority of projects in corporate america this just isn't a valid option.

Finally, to handle the additional projects that they are getting in India, a large amount of infrastructure has been needed to be created. This has raised the cost of living considerably there. Additional projects will require more infrastructure and higher cost of living. If this cycle were to continue India would lose much of their economic advantage.

[madape]

Market forecasts estimate that Feb job growth is going to be the largest monthly jump since the bubble burst. After the economy added a healthy 110,000 in January (surely to be corrected upwards), analysts have estimated an increase by as much as 175,000 in Feb. This would be the first time we've seen six digit job growth in back-to-back months since 2000. In fact, the job market looks so good right now that many think the FOMC will consider raising the interest rates to curb inflation. This has lead to the dollar to surge to four month highs against the Euro today.

Just as in terrorism, good news is bad news for the Dems. While a full-on job recovery won't prove quite as much of a downer as nabbing Osama will soon be, but it probably won't be bringing to many smiles to Kerry and his band of Bush bashers. So I'm sure next week Kerry will try to convince everyone that adding almost 200K jobs in one month is bad news... just as Howard Dean tried to convince people that capturing Saddam was bad news (it was... bad news for him).

The long schlong of job growth is finally emerging from the polka-dotted boxer shorts of the George W. Bush economic boom... and it's about to drop a load of piss right upon the elongated horse-shaped head of one French-looking, defense-program-axing, flip-flopping, morally-bankrupt, massachusets liberal.

[u2sarajevo]

But you know madape.... we can't continue giving tax cuts to the "wealthy".

[Mavdog]

Whoa there, not so fast on that forecast on "increase" in job growth. The Beige Book says it isn't so pretty out there for those seeking employment. The economy has a ways to go yet before anyone can be too pleased:

U.S. services robust in February but hiring meager
Wednesday March 3, 2:42 pm ET
By Pedro Nicolaci da Costa


(Adds Fed Beige Book)
NEW YORK, March 3 (Reuters) - The vast U.S. services sector grew robustly in February, but the expansion slowed from the prior month's record and job creation remained sluggish, an industry survey showed on Wednesday.


The Institute for Supply Management's non-manufacturing index fell to 60.8 in February from 65.7 in January, below

Wall Street estimates of a dip to 63.0. A number above 50 indicates growth.

"The one area of concern is the employment index, which moderated in the month, which suggests continued subdued job growth," said Sal Guatieri, senior economist at BMO Financial Group.

The survey's employment index slipped in February to 52.7 from 53.4 in January, suggesting an improving but still murky labor picture. Growth in new orders moderated, with that index moving lower to 60.3 from 64.9.

The services sector includes everything from restaurants and hotels to banks and airlines.

Many economists believe that, given the migration of many manufacturing jobs abroad, the long-awaited revival of the U.S. labor market would have to take place in the service sector.

But job growth has remained persistently below trend, a tendency confirmed by the Federal Reserve's Beige Book report. It said employment grew only slowly in most areas of the country over the past two months amid overall economic growth that ranged from moderate to accelerating.

[madape]

The long shlong of job recovery stayed in the presidents pants this month. Instead of pissing all over John Kerry's head, it pissed all over W's leg... giving Dems and Bush hating libs good reason to chuckle. The 21,000 jobs added was nowhere near the median estimates of 140K. What a punch in the gut. Let's just hope growth is twice as strong in March. That fool Kerry needs a good soaking.