August 2015

P&G reveals latest job cuts

Procter & Gamble Co. (P&G) has reduced its global workforce to 110,000, but the Cincinnati-based maker of consumer goods still has about 11,000 local workers, a spokesman said.

P&G  revealed its total head count in an annual report filed with the U.S. Securities & Exchange Commission. The company had reported having 118,000 workers worldwide the previous fiscal year, so the new number represents a reduction of 6.8%.

The local employment number remained stable, said Paul Fox, Communications Director for the company. However, just two years ago, P&G had reported that the local head count was about 12,000.

The updated employment numbers followed P&G’s July 30 report of its earnings for the fiscal year that ended June 30. P&G posted a profit of $7.1 billion, down 40 percent from nearly $11.8 billion in fiscal 2014.

P&G remains focused on reducing the number of employees as part of a cost-cutting effort, Fox said.

P&G has sold, consolidated or discontinued nearly 100 brands as part of CEO A.G. Lafley’s strategy to focus on 65 core brands.

The latest employment numbers take into account the divestiture of the pet food division. A $2.9 billion deal with Mars Inc. resulted in about 1,100 employees departing P&G, including about 325 who worked locally. More than 300 other P&G employees in Europe were affected by a subsequent sale of the rest of the pet care business to Spectrum Brands.

However, most of the job reductions were related to what P&G refers to as a productivity initiative, which is an ongoing effort that has included buyout offers.

Local P&G executives who have taken buyouts or are thinking about retiring are being targeted by some Cincinnati companies with openings to fill. Dan Kiley, CEO of Retirement Corp. of America, is organizing a Sept. 29 job fair in Mason, OH for those professionals.

About 10,000 more P&G workers will be shed in the next year as the result of a $15 million deal to unload 43 beauty brands to Coty Inc., and another 2,700 workers will no longer work for P&G after the sale of its Duracell battery brand to Berkshire Hathaway closes later this year. Those deals would drop P&G employment below 100,000. The last time the head count was that low was 2003, when P&G employed 98,000.

“Our highest employment was in 2006, when it was 136,000,” said Fox.

Since 2012, when P&G had 126,000 employees, the company has reduced non-manufacturing personnel by 22%, Fox said. The goal had been to cut employment by 10% by 2016.

“Clearly, we’ve more than doubled the original target set in 2012, and we’ve done that a year ahead of schedule,” Fox said. “And we’re targeting a 25 to 30% cumulative reduction by the end of fiscal 2017.

“That 25 to 30% does not include role reductions through divested businesses,” Fox said. “If you factored that in, then the roll reduction would increase to about 35%.”

SOURCE: Cincinnati Business Courier