In an effort to combat growing operating expenses and waning consumer demand, Procter & Gamble has revealed intentions to lay off around 7,000 employees, or roughly 6% of its global workforce, over the course of the next two years.
The company’s non-manufacturing employees, who make up over 15% of that group, will be the main victims of the layoffs.
Executives from the corporation announced the reorganisation at the Deutsche Bank Consumer Conference in Paris, stating that its goals are to increase role responsibilities, decrease team numbers, and streamline reporting structures.
In order to stay competitive in what it refers to as an increasingly unpredictable global market, P&G is positioning the project as an “acceleration” of its current approach.
Brand Missing to Achieve Sales Target Leads to Massive Job Cuts
Following inconsistent quarterly results in late April, the reorganisation decision was made. The company’s first-quarter net sales and organic sales growth fell short of projections.
According to the update, P&G and other major players in the consumer products industry have somewhat buckled under economic challenges connected to tariffs.
Citing cost uncertainties and squeezed consumers, the firm lowered its full-year revenue and earnings per share (EPS) projections. According to P&G CEO Jon Moeller, “We expect uncertainty to continue,” he told a media source.
According to Moeller, people are changing their habits to save money even when they aren’t switching to less expensive goods. For instance, in order to save detergent, P&G are observing that they do fewer loads of laundry each week.
According to statistics from a financial media outlet, experts have been lowering their EPS projections for P&G for the upcoming two quarters since the company’s results announcement.
Since the April 24 results, shares have fallen 1.1%, trailing the 8.35% increase of the Dow Jones Industrial Average and the 13% advance of the S&P 500. Following the news, the stock saw minimal movement in premarket trade on 5 June.
Layoffs have Become a New Normal for Bigger Players
This layoff announcement coincides with employment cuts by a number of multinational corporations, such as Amazon, Intel, and Goldman Sachs. Such developments are happening mainly owing to the growing impact of artificial intelligence (AI) and uncertainties in the global economy. Intel is getting ready for a massive restructure following a large financial loss in 2024.
Similarly, Amazon also plans to eliminate about 14,000 administrative roles in order to save $3 billion yearly.
Companies are increasingly focusing on cost optimisation and automation as a result of the rapid growth in AI adoption. This adoption is resulting in job losses across a number of industries.
Goldman Sachs is also getting ready to lay off employees, with intentions to trim staff by 3–5% after an annual performance review. About 150 junior banker positions were recently cut by Bank of America; nevertheless, the majority of impacted workers were offered opportunities outside of investment banking.
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