FedEx laying off more than 10% of its management ranks

Business Thursday 02/February/2023 18:09 PM
FedEx laying off more than 10% of its management ranks

Memphis: FedEx Corp is laying off more than 10 per cent of its global management staffers as the delivery company faces a shipping slowdown, the Wall Street Journal said.

In an email to staff on Wednesday, Chief Executive Raj Subramaniam said the company was reducing the size of its officer and director ranks and consolidating some teams and functions. According to the Wall Street Journal (WSJ), the company declined to say how many jobs were being eliminated.

The company has already trimmed its US workforce by 12,000 since the start of the current fiscal year in June 2022, through regular attrition, a hiring freeze and other head-count initiatives, WSJ said. It had more than 550,000 employees globally, according to its most recent financial statement in December.

"Unfortunately, this was a necessary action to become a more efficient, agile organisation," said Subramaniam, adding that "It is my responsibility to look critically at the business and determine where we can be stronger by better aligning the size of our network with customer demand."

FedEx is the latest large US corporation, from Microsoft to 3M, to announce plans to trim its workforce as businesses brace for slower economic growth this year and a pullback in spending by consumers and corporations, according to the financial newspaper.

In September, FedEx said it was freezing hiring, closing 90 FedEx office locations, parking some cargo aircraft, reducing Sunday ground operations and closing five corporate offices to offset a sharp drop in package deliveries. The company didn't say at the time whether it was cutting staff.

The company said in December that it continued to see weak demand for packages and that it had identified an additional USD 1 billion in cost savings, according to the financial newspaper. In the same month, FedEx Freight temporarily furloughed some workers as demand softened, it added.

According to WSJ, FedEx has several units, such as Ground, Express, Freight, International, Logistics, Services and Dataworks, and it has faced criticism from some analysts regarding overlapping functions in these units.