Archive for the ‘Jobs’ Category
Paul Gordon of the Journal Star notched a scoop this morning: a source is saying Caterpillar CEO Jim Owens will promise at tomorrow’s Obama visit in East Peoria that recently laid-off workers could be rehired if a federal stimulus act passes.
Owens, who will fly into Peoria on Air Force One with the president on Thursday afternoon, will encourage passage of a “significant stimulus package” in the United States and will offer his and Caterpilar’s encouragement for other stimulus packages being considered around the world, said a source familiar with the plans for Obama’s visit to Peoria on Thursday.
Owens, the source said, in his discussions with Obama and his public comments during the visit, will “emphasize that these economic stimulus packages are a critical step toward global economic recovery.”
If the packages are adopted and enacted quickly, it would give Caterpillar the opportunity to begin recalling those employees who have already been laid off since early December and like stave off planned near-term layoffs.
Before we launch the chorus of glory hallelujahs, however, we must keep a couple things in mind:
- Cat has not changed its mind about the plants in North Little Rock, Arkansas, and Sequin, Texas. Jobs eliminated because they’re moving to these locales will most likely stay gone.
- The stimulus package could spike demand for construction and power equipment, but demand for mining machinery would be farther down the road. Cat people in construction and finance could benefit sooner.
I’m still in wait-and-see mode on what gets said at Thursday’s visit. Cat is letting people go because demand is way off and it’s pointless to build machinery and let it stack up in a lot somewhere. Many of the people laid off would get rehired when the economy turns around; the stimulus package simply hurries things up a bit (potentially).
Honest question: how reliable is Gordon’s source? Well, given Cat’s Fort Knox mentality about guarding company information (and carefully telling only what it wants known), it’s safe to assume this was an approved leak. I can’t imagine anybody talking to the press without authorization when the company’s looking for reasons to reduce expenses.
This just in:
PEORIA, Ill., Feb. 11 /PRNewswire-FirstCall/ — Caterpillar Inc. (NYSE: CAT – News) today announced it is offering a voluntary early retirement incentive package to approximately 2,000 production employees in Illinois Caterpillar facilities (Aurora, Decatur, Joliet, Pontiac and the Peoria-area) as well as in Denver, Colorado; Memphis, Tennessee; and York, Pennsylvania.
This company-initiated incentive is being offered in accordance with Caterpillar’s Non-Contributory Pension Plan. Eligibility for this package is based on a combination of age and credited service.
The incentive plan announced today is in addition to other previously announced workforce reductions related to production employees. Consistent with previously announced plans, and depending on business conditions, more voluntary and involuntary workforce reductions may be required as the year unfolds.
Hmm. let’s see, my 401(k) is down 40 percent so, yeah, I want to retire as soon as possible to start cashing in my winnings.
Merle Widmer at Peoria Watch says he’s hearing that more people will get the heave-ho today; this gibes with some rumors I was told last week, namely that trimming the white-collar ranks would start in earnest this week.
Presumably these are among the non-production jobs mentioned in the most recent earnings report rather than evidence that things are getting even worse. Caterpillar expects this round of cuts to happen by the end of March.
Milwaukee Journal Sentinel finds a young Indian graduate-to-be who received a job offer in the middle of last year that suddenly went away in December.
Naveen Duraisamy’s future seemed enviable: Despite a down economy, the engineering student had a job offer from a Fortune 500 company, where he’d start after graduating from the University of Wisconsin-Madison.
Then, days before his Dec. 21 commencement, the international student got an e-mail from his future employer: Caterpillar Inc. had rescinded the job offer, citing uncertain economic times.
With his student visa about to expire, Duraisamy quickly enrolled in classes so he could stay in the country. He began the job search from scratch.
“I was completely shocked,” said Duraisamy, 26, a native of southern India. “I didn’t know what to say to them.”
Duraisamy is among dozens of mostly engineering and business students in Wisconsin who have had job or internship offers rescinded because of the economy.
Lot of this happening these days, I suspect.
National Public Radio tracks the effects of the Mossville, Illinois, layoffs from the factory floor to suppliers to a local restaurant and finally all the way to Las Vegas, where a laid-off Peorian was planning to attend a billiards tournament but might not now, for obvious reasons.
Tammie Cox of nearby Peoria just lost two jobs, which she says earned her about $30,000 a year — neither of them at Caterpillar, but both of them indirectly dependent on the company.
At one job she tracked Caterpillar parts.
“I was employed just recently through DHL Global Forwarding, but because of Caterpillar, they had to lay off employees,” she says.
Cox also waited tables at a Mossville restaurant and bar that depended on Caterpillar workers — a place called Building G.
“The Caterpillar workers use to, if they wanted to go have a beer or a get-together with their friends, they would say that there was a meeting at Building G,” she says.
Cox says that after a promising start last summer, the restaurant found that Caterpillar workers were cutting back, and business at Building G slowed to a halt.
Seems Cox is an ace eight-ball player who was planning to compete in Vegas but might have to pass on it this year.
Audio of this piece will be available around 7 p.m. EST. This is the kind of piece that NPR excels at.
(Incidentally: this link was sent along by a Cat Stock Blog reader — I won’t name names, but I wanted to say thanks and encourage everybody to send your tips along.)
Another 2,110 production workers will be out the door in East Peoria, Aurora and Decatur on April 13. These are on top of the job cuts announced Monday with the earnings report. The breakout, plus management and staff cuts included in Monday’s count:
- Aurora: 500 production; 96 management, staff & support
- Decatur: 1,026 production; 146 all the rest
- East Peoria: 584 production, 174 all the rest
Cat builds wheel loaders and hydraulic excavators in Aurora; off-highway trucks, motor graders and wheel tractor scrapers in Decatur; and track-type tractors and pipelayers in East Peoria.
Sorry for not posting this sooner; I’m still catching up on the sleep I lost Monday to blog the earnings release (4 a.m. on the East Coast, and I work second shift).
UPDATE: A forum at Peoria.com says the third shift at the Mossville plant was told their layoff started immediately rather than at the end of February, the previous plan.
Workers at Caterpillar’s articulated-truck plant in Peterlee, United Kingdom, approved a break in production:
The layoffs start next Monday when the factory will halt work on its line of articulated lorries for five weeks, with the staff to receive 75 per cent of their usual wages.
Union officials say a further break of six weeks with full pay and another week are also expected leading up to the end of May.
The decision was made after months of negotiations between unions and the company, which employs 700 people at its factory in Mill Hill, in the North West Industrial Estate.
Articulated trucks are basically two-piece machines with a big hinge connecting the tractor to the load carrier in the back. They work best over varied, uneven terrain.
They’re far smaller than the huge mining trucks Caterpillar builds in its Decatur, Illinois, plant, where I’ve been told demand for smaller trucks has also dried up.
Caterpillar is letting go of about 15 percent of the staff at its Pontiac, Illinois, factory, the Bloomington Pantagraph reports.
The layoffs, which will take effect Feb. 16, are the latest blow to the community of about 12,000 people. Since the start of 2008, the city has seen extensive flooding damage, battled the governor’s still-pending decision to close Pontiac Correctional Center — the city’s third largest employer — and learned of layoffs at Interlake Material Handling Inc.
At Caterpillar, the layoffs represent about 15 percent of the work force of more than 860 workers. The number doesn’t include an undetermined number of managers who may accept buyouts.
I once applied for a job at the Pontiac plant just before the economy cratered in about 1981 or so. Fate smiled on me, I figure.
As long as we’re on the subject, Cat won’t say how many of the 5,000 working in Decatur will be let go.
This article in Fortune questions the notion that you have no leverage in a layoff. It notes that under certain conditions, you might be able to finagle a better severance package.
For instance, let’s say your company’s rule of thumb is two weeks’ pay for each year of service. “That’s a commonly used formula left over from when people tended to stay with the same employer for many years,” Bayer notes. “But suppose you are a 50-year-old manager making $100,000 a year who was wooed away from a competitor and had to move across the country to take this job, and let’s say that was just two or three years ago. Is four or six weeks’ severance pay really fair?” In such a case, even the most hardnosed boss is likely to agree you should get more.
Another consideration: negotiating more favorable health coverage.
Sounds pretty Pollyanna-ish to a natural-born cynic like me. I mean, really, would any of this fly at a company like Caterpillar? Never know till you ask.
A more serious bit of advice to be culled from the article: find out your severance rights and do your utmost to get every penny you have coming to you. You might not get more but you should not settle for less.
RealClearMarkets posts an Investors Business Daily commentary encouraging lawmakers to break eliminate trade barriers with Colombia, and everywhere else for that matter.
Economist Dan Griswold, director of the Center for Trade Policy Studies at the Cato Institute, found exports were responsible for 6,667 new U.S. jobs at Caterpillar alone.
“Caterpillar is in many ways a typical American company,” Griswold told IBD. “It sells more abroad (63% of sales) than here, and it’s increasingly a global company. The success of its U.S. workers and shareholders is determined by its success abroad. That depends on free trade, freedom of investment, and strong relations with its commercial partners.”
Without free trade, Caterpillar is stuck paying around $100,000 in tariffs for each earthmover it sells to Colombia, a big mining country that’s one of Caterpillar’s best markets.
The article notes that trade unions in Colombia wants the government to reduce the tariffs so their employers will buy more Cat equipment.
Cat’s already sounding the alarm against “buy American” provisions in the stimulus package, which might sound odd coming from a U.S.-based company, but the Cat brass are more concerned about the blowback from trade barriers. If we put anti-trade rules in our stimulus bills, so will everybody else.
This is precisely what happened in the Great Depression: laws designed to protect jobs killed them by discouraging trade.