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Caterpillar layoffs: what I know

I get a ton of Google hits from folks desperate for information about when and where Caterpillar’s next paycheck punch is coming from. It’s heartbreaking to have to tell folks hey, I know what’s available already online, and it ain’t much.

Caterpillar’s earnings announcement did not say where the cuts would happen. It’s about 10 percent of the global workforce (not 20 as some said yesterday, because 8,000 were contractors who were not counted in the official total.)

Demand for Cat machines is down across the board. The most notable order backlog is in big mining trucks, but commodity prices aside from gold and coal are too cheap to encourage much exploration that inspires buying new equipment.

Here’s the full description of Caterpillar’s employee-related cost-reduction plans for 2009 (sorry for the repetition if you saw some of it yesterday.)

  • Voluntary and involuntary separations and layoffs of about 4,000 full-time production employees. Depending on business conditions more layoffs may be required as the year unfolds.
  • Sharp declines in overtime work. Factory overtime is a key element of volume flexibility and many facilities were working high levels of overtime through most of 2008.
  • Several facilities have shortened workweeks, and thousands of employees have been, or will be, affected by temporary layoffs and full and partial plant shutdowns.
  • Elimination of almost 8,000 temporary, contract and agency workers. While these workers are a key element of our “flexible workforce” they are not included among the 112,887 full-time employees at year end.
  • Voluntary separations of about 2,500 support and management employees.
  • Additional layoffs or separations of as many as 5,000 support and management employees.
  • Hiring freezes and suspension of salary increases for most support and management employees.
  • Significant reductions in total compensation for executives / senior managers.

Also, here’s a post on what to do about health benefits if you end up out of work. Also: Six things to do before you get laid off.

My hunch is Cat figures good times’ll return in 2010 and it doesn’t want to have to rehire all the people it recently fired. I would expect far more days-and-hours reductions and temporary plant closings than permanent pink slips.

If you know anything more about Cat layoffs, please share in the comments.

one comment | Permalink | Tags:
Tom Mangan posted at 8:08 am January 27th, 2009 |

One Response to 'Caterpillar layoffs: what I know'

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  1. Greg says:

    Tom’s got all of the facts and figures correct. I just pasted in the same numbers from an internal CAT e-mail that was sent to all employees that has a little futher clarification. Many of the cuts have happened or are happening right now.

    “”Clarification to workforce reduction number

    Today’s Fourth Quarter/Year End news release talks about actions that have been initiated to reduce the Caterpillar workforce by 20,000. The following information should clarify that figure and further actions the company will be taking.

    The 20,000 figure includes actions that have already been taken and others that are expected in 2009. This number includes Caterpillar employees and contract, agency and part-time employees. (A more detailed breakout is below.)

    Voluntary and involuntary separations and layoffs of about 4,000 full-time production employees. Depending on business conditions more layoffs may be required as the year unfolds. (This is a global figure and these actions have already occurred.)

    Elimination of almost 8,000 temporary, contract and agency workers. While these workers are a key element of our “flexible workforce” they are not included among the 112,887 full-time employees at year-end. (This is a global figure and these actions have already occurred.)

    Voluntary separations of about 2,500 support and management employees. (This figure represents the U.S.-based voluntary separation program announced in December.)

    Additional layoffs or separations of as many as 5,000 support and management employees. (This figure is global and these actions are expected to occur in the first quarter.)

    Several facilities have, or will have, shortened workweeks in 2009, and thousands of employees have been, or will be, affected by temporary layoffs and full and partial plant shutdowns. (These actions are global and some of these actions have occurred while others are anticipated.)””

    Permalink | Posted January 27th, 2009, at 4:48 pm

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