Big Squeeze

Protests Begin over Siemens Job Cull

VP 4477511,  Schild "Zeit um Flagge zu zeigen", 3.500 Beschäftigte der Siemens AG Bad Neustadt und SIS München demonstrierten gegen Personalabbau und Verlagerung der Arbeitsplätze nach Tschechien, IG Metall - Protestkundgebung, Siemens Konzernzentrale, Wittelsbacher Platz, München, Bayern, Deutschland, Europa  [Urhebervermerk: Werner Bachmeier/imageBROKER/vario images]  [JEGLICHE VERWENDUNG nur gegen HONORAR und BELEG. URHEBER/AGENTURVERMERK wird gemaess Paragraph 13 UrhG und unserer AGB ausdruecklich verlangt. Es gelten ausschliesslich unsere AGB. Tel: +49-(0)228-935650, www.vario-images.com]
Siemens' employees show their displeasure.
  • Why it matters

    Why it matters

    Siemens is aiming to increase its profitability to catch up with rival such as General Electric. But its cost-cutting program is dependent on job cuts and the support of powerful workers’ councils and unions.

  • Facts

    Facts

    • Siemens, with revenues of €72 billion ($81 billion) in 2014, aims to cut costs by €1 billion by 2016.
    • It plans to shed more than 12,000 jobs in low-profit units and to streamline management and speed up decision making.
    • Engineering union IG Metall is today staging protests at Siemens plants against the measures.
  • Audio

    Audio

  • Pdf

 

Nearly two years into his job, Joe Kaeser, the chief executive of industrial group Siemens, must be feeling increasingly squeezed.

The capital markets want him to speed up his restructuring program, instigated to reverse declining profits, and to finally catch up with more profitable companies such as ABB in Switzerland and General Electric.

But this will involve job cuts, and dissent is mounting among the workforce, whose representatives wield considerable power on German supervisory (non-executive) boards. Engineering union IG Metall is staging a day of protest at Siemens plants across Germany today.

Siemens’ management is convinced that the restructuring program, which as well as job cuts involves shedding some divisions, hiving off its healthcare operation and buying U.S. oilfield equipment maker Dresser-Rand, will pay dividends.

 

Kaeser annual press conference DPA
Siemens CEO Joe Kaeser has a mammoth task on his hands. Source: dpa

 

Soon after he took the helm at Siemens in August 2013, Mr. Kaeser announced a plan to cut costs by €1 billion, or $1.12 billion, by 2016 as part of the “1by16” project. Chief Financial Officer Ralf Thomas told Handelsblatt: “We’re on course to reach our savings potential as part of 1by16.”

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