Cap Gemini to cut further 2000 jobs
French consulting group Cap Gemini Ernst & Young will reportedly cut about 2,000 more jobs on top of the 3,500 already announced this year.
A spokesperson would not say in which countries the next round of layoffs would occur, although job cuts announced earlier this year took place in the UK, Scandinavia and the US.
According to a report in the New York Times, Maurice Abell, chief executive of Cap Gemini’s UK operations, informed 9,000 employees on a pre-recorded message that 750 jobs, or 8% of the company’s work force in the region, must be cut.
‘If enough workers do not voluntarily step down by January, the company will begin layoffs,’ the report said. It is looking for volunteers among its employees in the UK and Ireland for voluntary redundancy, or an early retirement plan.
Cap Gemini plans to update investors on sales trends on 13 December. Credit Suisse First Boston analysts expect the update to include details of cost cutting moves which will include the additional job cuts as well as the lowering of salaries for the 10% highest paid employees.
Broker JP Morgan downgraded its recommendation on the stock to ‘market under-perform’ from ‘market perform’.
Cap Gemini announced last month that earnings would fall short of expectations owing to deteriorating economic conditions, but declined to make a forecast beyond that.
Analysts have said that the firm had difficulty integrating US consulting firm Ernst & Young, which it bought in February last year. At the end of August, the company employed 59,800 workers.
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Cap Gemini says results will be down
Cap Gemini Ernst & Young axes jobs
This article first appeared on vnunet.com