Author Topic: Buffett's Berkshire cuts jobs broadly, more coming-March 3, 2009 10:12 AM ET  (Read 1929 times)

GOODYRL

  • Newbie
  • *
  • Posts: 12

http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&date=20090303&id=9661169

Buffett's Berkshire cuts jobs broadly, more coming
March 3, 2009 10:12 AM ET
NEW YORK (Reuters) - Warren Buffett's Berkshire Hathaway Inc reduced staffing last year in half of its nearly 80 operating units, and said more job cuts were coming in an economy unlikely to recover before 2010.
Many of the deepest cuts came in businesses tied closely to the housing market. Clayton Homes Inc, a manufacturing housing unit, eliminated 2,290 jobs, or 16 percent, to end the year with 11,998 workers. Carpeting maker Shaw Industries shed 1,900 jobs, or 6.2 percent, to end with 28,974 workers.
Other units tied to housing that cut jobs last year include brick maker Acme Building Brands, paint producer Benjamin Moore, recreational vehicle maker Forest River Inc, real estate brokerage HomeServices of America, and furniture makers Star Furniture and R.C. Willey Home Furnishings.
Berkshire detailed the operating unit cuts in a Monday filing with the U.S. Securities and Exchange Commission.
It said the units "will continue to take cost reduction actions in response to the current economic situation, including curtailing production, reducing capital expenditures, closing facilities and reducing employment to partially compensate for the declines in demand for goods and services."
Buffett, who runs Berkshire and is one of the world's wealthiest people, normally stays out of day-to-day management at Berkshire's operating units, though he monitors their performance and regularly talks with executives.
In his annual letter to Berkshire shareholders on February 28, Buffett said the economy will be "in shambles" through 2009 and perhaps beyond.
"Most of the Berkshire businesses whose results are significantly affected by the economy earned below their potential last year, and that will be true in 2009," he wrote.
Economists polled by Reuters last month on average expected the U.S. unemployment rate to rise to 9.1 percent before the recession ends, up from 7.6 percent in January. Some analysts fear the rate could reach double digits.
Overall employment within Berkshire rose 5.7 percent last year to 246,083 workers, largely from the acquisition of the 18,000-person Marmon Holdings Inc, which makes industrial products. Excluding Marmon, staffing fell 2 percent.
Six of Berkshire's 10 insurance businesses including the largest, auto insurer Geico Corp, also cut jobs in 2008.
The Omaha, Nebraska, home office of Berkshire was spared job cuts in 2008. Staffing there was unchanged at 19.
(Editing by Maureen Bavdek)