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FedEx Freight layoffs will number 900

Posted on April 3, 2009

Memphis-based FedEx Corp. laid off 1,000 salaried managers and professionals across its global work force Friday, a day that a FedEx spokesman described as painful and one “we thought we could avoid.”

Five hundred of those layoffs occurred in the Memphis area, where the package and shipping giant employed about 33,000 people before the cuts. FedEx’s worldwide employee roster totals about 290,000.

“This is a very difficult day for FedEx and for our colleagues,” said FedEx spokesman Maury Lane on word of the layoffs. “We’ve done everything we could since December to try to avoid this situation.”

Back in December is when FedEx announced pay cuts of 5 percent for all of its salaried personnel in the U.S., even deeper cuts for senior executives, the scrapping of some bonuses and a freeze on 401(k) contributions. FedEx unveiled the scope of the 1,000 job cuts last month on word that the company’s fiscal third quarter earnings were lower than expected.

Fedex described global conditions that precipitated the cuts as having worsened more than anticipated and creating an economic slump that’s “unprecedented in our company’s history.”

Lane said employees affected by the layoffs would be offered a “generous severance package,” outplacement assistance and early word of future FedEx job opportunities before they’re announced publicly.

How Could FedEx Layoffs Impact Local Economy?

Memphis, TN- Some say when FedEx sneezes, Memphis gets pneumonia. Many are wondering after today’s layoff of 500 Memphis employees, what could happen to the local economy. With fewer workers and a company that is still battling tough economic times, what could be the ripple effect?

A former FedEx employee who now works for a company that does business with FedEx says his new boss is losing work.

“The companies that vend for FedEx, if FedEx isn’t making money, the vendors are not making money. They aren’t going to have any work.”

The man who was let go last fall believes the cuts will spill over into the community on a broad scale.

“Fed Ex holds a lot in its hand. If people are not working, they are not spending money, they are not eating out, they may lose their homes
and leave the area and then that’s a loss of tax base,” says the former employee.

Categories: Business

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