State to lay off 20K workers, halt construction projects

A Times-Standard Staff Report

Posted: 02/19/2009 01:30:19 AM PST

As the contentious budget stalemate plods on in Sacramento, with recent announcements of stop-work orders and tens of thousands of layoffs, local representatives are starting to say they should shoulder some of the burden.

A plan to address the state's $42 billion budget deficit has seemingly stalled in the state Senate after days of marathon sessions left the package one vote shy of passage. Consequently, Gov. Arnold Schwarzenegger announced this week the state would begin the process of laying off 20,000 employees effective July 1 and would order work stoppages on 276 projects throughout the state in a desperate attempt to slow the state's fiscal bleeding.

With the state already having instituted mandatory work furloughs and pay cuts, local representatives state Sen. Patricia Wiggins and Assemblyman Wesley Chesbro said this week it would only be fair for legislators to consider shouldering some of the burden in a show of sacrifice and solidarity.

Asked if she would consider supporting a pay cut for legislators or their sacrificing the per diems -- the $170 they are paid by the state for every day they are in session -- for the duration of the budget stalemate, Wiggins said the Legislature has already taken a hit, but that more should be considered.

”It's only proper, and fair, that members of the Legislature consider shouldering our share of the burden -- we're making reductions in the Senate's own budget, for example, but we should consider other options as well,” Wiggins said in a statement released Wednesday.

Chesbro had a similar take.

”I think that would be absolutely fair if everyone else is taking a reduction,” Chesbro said of taking a pay cut during an interview Tuesday with Eureka's KINS Radio, adding that he would both personally look into the option and encourage his colleagues to do the same.

According to a list provided by the State Department of Finance, the governor's order will halt work on three Humboldt County projects with an estimated value of more than $40 million, meaning less work for local construction crews.

A $1.75 million project at Fortuna Elementary School has been stopped, as well as an almost $16 million project to revamp the interchange between U.S. Highway 101 and State Route 36. But, the largest local project to be shelved was $23.1 million in state funds for a North Coast Integrated Watershed Management Plan. One of Humboldt's neighbors to the south, Willits in Mendocino County, also saw the state halt work this week on $1 million in wastewater treatment plant upgrades.

But the largest worry in the state, that of mass layoffs of state employees, seems to have spared Humboldt County for the most part, at least so far.

The State Department of Corrections and Rehabilitation will take the largest brunt of the layoffs, according to Lynelle Jolley, a spokeswoman for the State Personnel Administration Department, adding that corrections is by far the largest general fund-dependent department in the state.

Up at Pelican Bay State Prison in Del Norte County, spokesman Lt. Ken Thomas said it's too early to say how many of the prison's 1,700 employees will be affected, but said it's unlikely the prison will escape the layoffs unscathed.

Thomas said there are 67,000 employees in the state's corrections department, and that 13,000 -- or just under 20 percent -- of them are expected to receive layoff notices. If the layoffs are applied proportionally throughout the state's prisons, that means Pelican Bay Prison could lose almost 350 employees.

”Although we've not received anything from Sacramento identifying any specific positions, to think Pelican Bay would go through a process like that without anybody being affected is unlikely,” Thomas said.

Back in Humboldt County, most agencies said it's too early to tell, but that they are looking to escape this round of layoffs unscathed.

”We have not heard anything about layoffs yet from the personnel administration -- it has not been passed down to our department,” said Cal Fire spokesman Daniel Berlant. “We are in a wait-and-see mode.”

Jolley said two departments that definitely won't be touched by layoffs are the Department of Motor Vehicles and the California Highway Patrol, both of which are considered revenue-generating agencies and are financially self-sufficient.

But Wiggins cautioned that state workers aren't the only ones facing layoffs, and that the governor's decision to shut down 276 infrastructure projects means the loss of tens of thousands of construction jobs.

”That's 65,000 good-paying construction jobs in California -- gone,” she said. “One vote could turn that around. The governor says that he will lay off 20,000 state workers if we do not have a budget. One vote could turn that around. These are Californians who are out of work as a direct result of us not having a state budget.”

Times-Standard staff writers John Driscoll, Sean Garmire, Thadeus Greenson, Donna Tam and Erin Tracy contributed to this report.p

Schwarzenegger sends out 10,000 layoff notices

CNN) -- California Gov. Arnold Schwarzenegger issued 10,000 layoff notices Tuesday, affecting a wide spectrum of state employees and aimed at dealing with the state's budget crisis, a spokesman said.

Unemployed construction workers demonstrate in Los Angeles, California.

California lawmakers resumed negotiations late Tuesday after the longest legislative session in state history over the weekend resulted in a budget impasse.

"Every state employee who receives a salary under the general fund is affected, and the governor began issuing layoff notices for the least-senior employees in various agencies," said Aaron McLear, the governor's press secretary.

The layoffs would begin on July 1, which marks the fiscal year, and includes jobs in the Departments of Health and Human Services and Corrections, among others, McLear said. Another 10,000 layoff notices could be issued on Wednesday in other departments, he said.

The governor, facing a $42 billion deficit, was prompted to move on the layoff notices after lawmakers missed a Monday night deadline to reach a budget deal, McLear told CNN late Monday.

The Republican governor, who declared a fiscal emergency in December, has butted heads for months with the Democratic majority over alleviating the state's $11.2 billion revenue shortfall this fiscal year alone. The cuts would save California $750 million for the year. The state's $42 billion deficit is for the current and next fiscal years. iReport.com: What you'd fix first

Schwarzenegger warned lawmakers about the cuts last week, urging them to approve the latest budget proposal. However, voting was stalled over a 30-hour weekend session as the legislature mulled over 26 pieces of legislation that make up the budget package. Interactive: See projected state budget gaps »

The State Assembly in Sacramento postponed action until Tuesday. A single Republican vote was holding the budget from passing with a two-thirds majority, McLear said. The cuts wouldn't begin until the start of the fiscal year on July 1, starting with employees with the least seniority.

Last month, the state began delaying $3.5 billion in payments to taxpayers, contractors, counties and social service agencies so the state could continue funding schools and making debt payments. Watch more on California's budget woes »

On Tuesday, Kansas managed to work through its budget issues, which had forced the state to suspend tax refunds and caused concern it would not be able to to pay state employees.

But Gov. Kathleen Sebelius ended the budget impasse by signing a bill to balance the budget, according to CNN affiliate KMBC-TV.

The signing of the bill was a key demand for Republicans who had been blocking the Democratic governor's plan to transfer $225 million into the state's main bank account from other state government accounts.

With her signature, Sebelius ended a cash crunch a half-hour before a key payroll budget deadline.

KMBC reported the state's 42,000 employees should receive their biweekly paychecks on time Friday.

With Sebelius' signature on the bill, the state may not have had enough money to pay state employees, or provide money for schools and health-care providers. Kansas also stopped processing income tax refunds last week because of low funds, said Department of Administration spokesman Gavin Young.

"This political game the Republican leaders are playing affects real Kansas families," Sebelius had said Monday in a written statement. "The Republican legislative leadership is jeopardizing our citizens' pocketbooks for no other reason than to play political games -- games in which the only ones set to lose are Kansas families, workers and schools."

Kansas' money problems stem in part from the recession, but also from "substantial" funding to finance public schools and Medicaid, said Senate Majority Leader Derek Schmidt.

Young said as of Monday, Kansas only had $10 million in its general fund. The state has some 42,000 full-time employees, but about 55,000 paychecks are affected, he said.

And the economic woes are also a problem for neighboring Colorado. State workers may face unpaid time off in an effort to spare Colorado's colleges and universities millions of dollars in budget cuts, KUSA-TV reported Tuesday. Interactive: Estimated job growth across the country

Gov. Bill Ritter, a Democrat, announced plans recently to furlough some state workers in an effort to balance the budget. There is roughly $600 million in budget cuts that need to be made by the end of this fiscal year in June, according to KUSA.

State lawmakers will debate a bill in the House later this week that would require furloughs for state workers depending on how much money they make.

"It's drastic, but we're in a drastic situation," Rep. Steve King, R-Grand Junction, told KUSA.

If the bill passes, state employees making $60,000 or more would be subject to two unpaid days off per month. Those earning $40,000-$59,999 would be forced to take one and a half days off. Anyone taking home $39,999 or less would take one furlough day per month.

Denver's Democratic Mayor John Hickenlooper instituted a furlough system for city workers.

In Washington state, KOMO-TV reports that proposed budget cuts have led to protests in its capital, Olympia.

State officials are looking at some $300 million in cuts as part of a package the governor is expected to sign this week. Lawmakers are also aiming to cut nearly $6 billion over the next two years.

But about 100 union members, state employees, school supporters and health-care providers rallied on the lawn of the Capitol, telling lawmakers to stop the budget cuts to health care and education and prevent tuition hikes. State employees say they want fair pay, better benefits and pensions and no layoffs.

"We're in challenging times, and I think the government needs to be looking at things in a new way," Rodolfo Franco, president of the Local 304 chapter of the Washington Federation of State Employees, told KOMO.

The budgetary woes are also affecting Hawaii, a state heavily dependent on tourism and hospitality that is typical hit hard by a recession.

Hawaii faces a nearly $2 billion budget shortfall in the upcoming fiscal year. That figure has led legislators to seek alternative ways of balancing the budget, including possible reductions in health and retirements benefits for government workers, KHNL-TV in Honolulu, Hawaii, reported Tuesday.

One bill being debated in the legislature aims to cut off insurance benefits for all employees retiring after July 1 regardless of how many years the employee earns.

On the East Coast, states including New York and Florida, which have high unemployment rates and huge budget shortfalls, are also looking to cut programs. Watch more on how the stimulus plan will work »

In New York, the expected budget shortfall is around $1.7 billion, according to the National Conference of State Legislatures.

President Obama took his economic stimulus message to Florida last week to hard-hit Fort Myers. The jobless rate in the area is 10 percent, up from 2.3 percent this time in 2006, and the area's foreclosure rate of 12 percent is the highest in the nation. Interactive: See where the stimulus money is going »

And Michigan's Democratic Gov. Jennifer Granholm, whose state has been especially hard-hit by the recession and the near-collapse of its auto industry, says job creation is paramount to turning the economy around.

"We see the impact of this every day, and I'm speaking not just for Michigan, but for governors across the country. We need help. We need it now. And it's not about budgets; it's about creating jobs in our states," she said recently on CNN's State of the Union with John King.

That sentiment is echoed by nearly every governor, as witnessed by an urgent statement put out by the National Governors Association in late January.

"States are facing fiscal conditions not seen since the Great Depression -- anticipated budget shortfalls are expected in excess of $200 billion. To address these shortfalls and meet balanced budget requirements, states have begun taking action to cut government services or increase revenue. Absent federal action, states will have to take even stronger actions that will make the recession more severe and slow the nation's economic recovery," the group said in a letter released January 27

THQ To Lay Off 600

Agoura Hills-based THQ, a developer and publisher of video games, said Wednesday that it is making "additional cost reduction actions" which includes the layoff of approximately 600 people, or 24 percent of the company's workforce. THQ said the move was a response to the continuing uncertainty in the market. The firm said that the cuts include a reduction in product development spending by an additional $70M, through "studio dispositions" and other project and headcount reductions. THQ also said it would chop sales, marketing, and corporate expenses--including headcount--to try to save an additional $30M annualy. The bad news came in conjunction with its quarterly results, where THQ said it had net sales in the quarter of $357.3M, down significantly from last year when it had net sales of $509.6M. In a statement explaining the results, THQ President and CEO Brian Farrell said it "fell short" of its revenue and profit due to a "challenging environment." The cuts announced Wednesday are on top of restructuring the firm announced in November.

Allergan to lay off 100 in O.C., 460 worldwide

Allergan Inc. says it is laying off 100 workers in Orange County, leaving about 2,000 employees at the Irvine headquarters of the maker of Botox and other health care drugs and devices.

The company will cut 460 jobs worldwide or about 5% of its total workforce, Chairman and Chief Executive David E.I. Pyott said today, announcing the earnings for 2008.

Pyott

“This is probably the worst day I’ve had in 10 years at Allergan,” Pyott said. “But the long-term health of the company is what it’s all about. Unfortunately, I’ve got to look after the 95% (of employees) who stay.”

The layoffs will primarily hit the marketing department and urology products division, Pyott said.

Allergan reported it earned a net profit of $150.6 million for the fourth quarter of 2008, down from $160.6 million for the same period in 2007. For the year, Allergan’s profit jumped to $578.6 million from $499.3 million in 2007.

Sales of Botox, the wrinkle treatment drug, slipped 3.1% in the fourth quarter to $329.2 million. Sales of all Allergan’s eye-care pharmaceuticals fell 3.6% to $466.9 million for the quarter.

Total sales for 2008 were $4.3 billion, up from $3.9 billion. Allergan forecast sales in 2009 will range between $4.1 billion and $4.3 billion.

Pyott said the company hopes sales will improve in 2010, but it is not planning for that to happen. On the negative side, American and European consumers are expected to scale back on purchases of products, such as Botox, which are not covered by insurance. On the positive side, new markets are opening in Asia for Botox, Pyott said, and six products are in the pipeline for approval by the U.S. Food and Drug Administration, which could improve sales.

California's Unemployment Rate Increases To 9.3 Percent

By: California Employment Development Department (EDD)

SACRAMENTO Jan. 23, 2009 - California's unemployment rate was 9.3 percent in December, and nonfarm payroll jobs declined by 78,200 during the month1, according to data released today by the California Employment Development Department (EDD) from two separate surveys.

The number of people unemployed in California was 1,732,000 - up by 166,000 over the month, and up by 653,000 compared with December of last year.

Of the unemployed, 785,200 were laid off, 125,300 left their jobs voluntarily, and the remaining were either new entrants or reentrants into the labor market, or persons who completed temporary jobs, according to the federal household survey.

PAYROLL EMPLOYMENT DETAIL (SEASONALLY ADJUSTED)

EDD's report on payroll employment (wage and salary jobs) in the nonfarm industries of California totaled 14,913,600 in December, a net loss of 78,200 jobs since the November survey. This followed a loss of 73,500 jobs (as revised) in November.

One category, educational and health services, added jobs over the month, gaining 2,300 jobs. Ten categories (natural resources and mining; construction; manufacturing; trade, transportation and utilities; information; financial activities; professional and business services; leisure and hospitality; other services; and government) reported job declines this month, down 80,500 jobs. Trade, transportation and utilities posted the largest decline over the month, down by 25,400 jobs.

In a year-over-year comparison (December 2007 to December 2008), nonfarm payroll employment in California decreased by 257,400 jobs (down 1.7 percent).

Three industry divisions (natural resources and mining; educational and health services; and government) posted job gains over the year, adding 58,700 jobs. Educational and health services showed the strongest gain on a numerical basis, adding 51,600 jobs (a 3.1 percent increase). On a percentage of growth basis, natural resources and mining showed the strongest gain, up 4.3 percent (adding 1,100 jobs).

Eight categories (construction; manufacturing; trade, transportation and utilities; information; financial activities; professional and business services; leisure and hospitality; and other services) posted job declines over the year, down 316,100 jobs. Construction employment showed the largest decline on both a numerical and percentage basis, down by 92,600 jobs (a decline of 10.8 percent).

UNEMPLOYMENT INSURANCE CLAIMS (NOT SEASONALLY ADJUSTED)

In related data, the EDD reported that there were 655,445 people receiving regular unemployment insurance benefits during the December survey week. This compares with 593,670 last month and 451,098 last year. At the same time, new claims for unemployment insurance were 87,979 in December 2008, compared with 80,920 in November and 56,984 in December of last year.

The U.S. unemployment rate also increased in December to 7.2 percent.

In November, the state's unemployment rate was 8.4 percent, and in December 2007, the unemployment rate was 5.9 percent. The unemployment rate is derived from a federal survey of 5,500 California households.

Nonfarm jobs in California decreased by 78,200 over the month, for a total of 14,913,600, according to an EDD survey that is larger and less variable statistically. The survey of 42,000 California businesses measures jobs in the economy. The year-over-year (December 2007 to December 2008) change shows a decrease of 257,400 jobs (down 1.7 percent).

EMPLOYMENT AND UNEMPLOYMENT IN CALIFORNIA

The federal survey of households, done with a smaller sample than the state employer study, also shows a decrease in the number of employed people. It estimates the number of Californians holding jobs in December was 16,917,000, a decrease of 100,000 from November, and down 323,000 from the employment total in December of last year.

NOTE: The U.S. Bureau of Labor Statistics (BLS) has changed some of its prescribed methods for estimating state job losses and gains in order to try to better match the estimates that come from the larger national sample of businesses. The BLS' new methodology gives less significance to historical data and more significance to sample data from similar industries, as well as extreme high- and low-end survey responses from employers. The BLS hopes these changes will better capture the magnitude of job change during a time of rapid economic change. For many states, including California, the adoption of those changes means a much higher revision in announced job loss estimates for November than usual for any given month. It also means significant job loss estimates for the month of December.

Since these estimates are based on recent survey data, the degree to which these new methods better reflect actual economic events will not be known until the monthly estimates are compared to the universe data reported with employers' quarterly Unemployment Insurance tax returns in the annual benchmarking process that will be conducted in early 2010.

LA board OKs layoff plan for nearly 2,300 teachers

The Associated Press

Posted: 01/13/2009 07:10:24 PM PST

LOS ANGELES—The Los Angeles Board of Education has approved a plan to send out layoff notices to nearly 2,300 teachers, though the district superintendent says he is seeking alternatives to solve its budget crisis.

The board approved the cutbacks Tuesday as the Los Angeles Unified School District faces a budget shortfall of up to $400 million. Superintendent Ramon Cortines says no layoff notices will be sent until he is sure they are needed.

He says he will meet with the board later and issue a final recommendation.

The teachers who may be laid off this school year are untenured teachers with the least seniority.

District officials say the cuts could save the district more than $137 million over a full year.

The district, the nation's second largest, has about 45,000 classroom teachers

California Governor Orders 10% layoff for State Emplo

Executive Summary - Arnold Schwarzenegger, the Governor of California ordered a hiring freeze and a 10% layoff of all state employees to ease the budget crisis. He also ordered the states 235,000 employees to take two days a month off from work without receiving any compensation for these days taken off.

Discussion – The Governor is not only a movie star and politician but he was an accomplished businessman before being elected to office. He understands a budget and making money quite well. He is trying to make things work and is getting resistance from their state legislature. California while only a state represents one of the largest budgets in the world. It is worthy of note that the law enforcement officers of California are not exempt from this layoff, neither are the state tax collectors.

England is laying off their tax collector agents in large quantities. Only time will tell if the US Federal Government will get realistic and layoff some from their overly padded payrolls. The fact that the UK did it is encouraging and is probably an indicator of what the USA will do – layoff coming. It is hard to believe Obama will not go to cuts in government spending including job cuts from the Federal payroll. To not do so in view of their financial insolvency would be insane.

You can’t realistically collect taxes from a nation of people out of work, with savings wiped out due to stock market crashes and real estate crashes. This is not the time for aggressive tax collection efforts since you can’t get blood from a stone. People working in some of the let us say not too popular jobs in government (you know who they are) will have to face going to the private sector for work when they get laid off. Their popularity with the private sector is going to be a hard to overcome obstacle due to their past job descriptions and the way they were perceived as performing their duties by the private sector. Their prospects for being absorbed into the private sector would be less than encouraging. This is something people holding these jobs thought they would never have to face in their lifetime.

The irony is that the USA economy is so very badly broken that even Obama is saying it may take at least his whole term to get things beginning to be on track again. The year 2009 is going to be worse than 2008 so the layoffs from the government sector is something we are first going to see come into its fullness next year. As people lose their jobs they of course pay less taxes. As business fail and close their doors less taxes from income, payroll etc. As more people go into foreclosure less taxes from property and sales of real estate. As people go bankrupt less taxes overall. As retail sales drop less taxes from sales tax and employment.

Another thing we may see is early release from the prisons in the USA since they have over 2 million people behind bars and that is probably running about $35,000 a year each. Then there are millions on supervised release, probation, parole etc. This too costs a lot of money. The California Governor tried this before bad the legislature rejected it. The reality is this will have to stop. The vast majority of people incarcerated never injured anyone physically.

Most just broke statues where the government statue was the victim so do not expect a massive crime wave from early release. Prospects for more government healthcare of course are dismal at best. Government programs and jobs across the board are going to have to be cut back.

Silicon Storage to layoff 120, or 17 percent of workforce

Silicon Storage Technology, the Sunnyvale maker of flash memory, said it is in the process of cutting 120 employees, or 17 percent of its staff, according to a filing it made Friday. The action is being taken “to streamline the organization going forward” so as to “to reflect changes in anticipated levels of business.”

With so many companies laying off employees, the chance for a change in “anticipated levels of business” going forward keeps getting better and better.

The terminations are expected to cost the company $2.8 million, “nearly all of which” is going to expected severance payments, which works out on average to about $23,333 per employee. The company expects to complete the layoffs by Dec. 31 — Happy New Year.

The Layoff Kings: The Companies That Cut The Most In 2008

(C)(HPQ)(T)(GM)(BAC)(SBUX)(WFC)(DOW)(JAVA)(JPM)(AMR)(MRK)

People who get to the end of 2008 and are still at work can be thankful. The unemployment rate will probably be over 7%. That does not count the people no longer looking for work. Add them in and the figure is probably over 12%.

The business headlines have been filled with reports of layoffs nearly every day in the last half of the year. A lot of these have come at big, profitable companies, which says something about what they expect in 2009. Obviously, many of the largest cuts came at firms such as Citigroup, which are struggling to stay afloat, or firms such as Bear Stearns which simply disappeared.

Here is the 24/7 Wall St. 2008 report on the twenty largest layoffs by company. If a firm cut more than once during the year, those numbers have been combined for an annual total. We extend special thanks to Challenger, Gray & Christmas for its help.

1. Citigroup announced layoffs of just over 73,000. The big bank announced last month that it would let over 50,000 people go on top of 23,000 already fired or that were in the process of leaving. New CEO Vikram Pandit has done an especially poor job of getting Citi back on track. The firm’s stock has fallen from a 52-week high of $31.14 to $7.83. Several stock analysts have cut their fourth quarter earnings estimates. The government’s bailout of the bank, put together last month, may not be enough. Citi may have to raise more capital and fire more people.

2. The Bank of America (BAC) buyout of Merrill Lynch will cost 35,000 people their jobs. There are overlaps at the companies particularly the research and investment banking divisions. A total of 11% of the combined workforce will be shown the door. The layoffs at the newly merged company may not be over. Bank of America is considered undercapitalized. It took on a lot of home mortgages when it bought Countrywide. The net effect of that is that its stock is off as much as Citi’s over the last three months. The BAC roll-up of Merrill and Countrywide probably won’t work without a lot more costs cut.

3. General Motors (GM) has said that its cuts for this year add up to almost 34,000 people. That number is modest compared with the number of jobs the company took out in 2006 and 2007. If the firm goes into Chapter 11 cuts for 2009 may go up again.

4. Hewlett-Packard (HPQ) is one of the most successful tech companies in the world, perhaps because it is ruthless as keeping costs down. It bought IT consulting firm EDS earlier this year and slashed 25,000 people while mashing the two operations together.

5. Lehman Brothers simply does not exist anymore. In September, the company filed for Chapter 11. Some of the people in divisions bought by other companies or kept open waiting for buyers may be OK, but more than 23,000 poor souls were shoved out of work.

6. AT&T (T) is another company which is doing remarkably well, but does not want to face a hard economy with excess staff. The one part of the firm which has done very badly is its traditional landline business. The number of people and businesses who keep a traditional phone is dropping. Too many customers are moving to cell service of VoIP. The phone company chopped 12,000 people earlier this month. Added to other, smaller cuts and the total for the year is more than 17,000.

7. DHL Express cut almost 15,000 people. The ground and air shipping industry is being torn up by people who save money by using the post office or electronic delivery. DHL rivals Fedex (FDX) and UPS (UPS) are also having a hard time. DHL’s parent, Deutsche Post World Net, closed its land and air shipping operation in the US in early November.

8. The California Department of Education shows that the public sector is not being sparred. California has gone to the federal government for aid because of a massive budget deficit. The state is paying some vendors with IOUs and is threatening to cut some services completely. In the midst of all that 14,000 teachers will be out of work. If over-muscled governor Arnold Schwarzenegger cannot get California’s books balanced, the state will be letting a lot more people go.

9. Starbacks (SBUX) founder Howard Schultz came back to the company as CEO when he saw that the people he had put in place to run the company were screwing it up. His return did not make that any better. No one at the firm wanted to believe that customers would not pay $4 for a fancy cup of coffee in a recession, especially when McDonald’s was selling the same product for $2. To keep Starbucks in the black it closed over 600 stores and fired more than 12,000 people. The premium coffee business is not getting any better. The job cuts at Starbucks are not over.

10. Chrysler let over 12,000 people of this year on top of all those who left in 2007. Since the car company is on the brink of Chapter 11, the number of workers who leave the company may still move way up.

11. Citigroup tried to buy Wachovia, but Wells Fargo (WFC) snuck in a side door and got the prize. This was one of a number of large bank and brokerage house mergers. It probably would not have mattered who bought Wachovia. To save money and cut redundant services, the firm cut more than 11,000 jobs

12. Dow Chemical (DOW) is another profitable operation where earnings are being squeezed by the economic downturn. To combat falling margins, the firm is closing 20 plants and laying off 5,000 workers and 6,000 contractors. All those people being let go will be happy to hear the company is keeping its dividend.

13. NASA has said it will need fewer people when the space shuttle goes into retirement. The agency that put a man on the moon is cutting nearly 11,000 jobs.

14. The State of California makes the list twice as it chops seasonal jobs to preserve more cash. That means fewer lifeguards and guards at the state capital. It may also take longer to get a driver’s license. The cuts total more than 10,000 people

.15. Sun Microsystems (JAVA) is one of the worst run tech companies in the world. To stay ahead of its revenue trouble it likes to make big jobs cuts every year. In 2008, the total is 9,500. Instead of one big layoff, Sun decided to make one announcement early in the year and one last month. Sun will take a charge of about $600 million. No wonder the stock trades at just over $4. A little over a year ago, shares changed hands at $24. What is surprising is that CEO Jonathan Schwartz is still on board.

16. Bennigan’s filed for Chapter 7 in July. People just can’t afford to eat out the way that they used to. The restaurant company’s 150 company-owned stores shut down. Over 9,000 people lost jobs.

17. JP Morgan Chase (JPM) bought the banking operations of Washington Mutual, a bank which had become bloated with home mortgage loans made when real estate prices were flying up. JPM raised $10 billion to cover the costs of the transaction. It will get part of that money back by cutting over 9,000 people.

18. Bear Stearns simply disappeared in March after being in business for 85 years. JPMorgan bought the place for $2 a share. Because of rumors about Bear’s mortgage holdings customers started to pull their money out. The investment house was gone before it had a chance to say goodbye to its staff. JPM did not need all those bankers and brokers. More than 9,000 people were forced out of work.

19. American Airlines (AMR) was a victim of high fuel costs. Faced with rumors it could not finance its operations with oil well above $100, it had to cut the number of routes it was flying, the number of planes it operated, and more than 8,500 jobs

20. Merck (MRK) was just one of the Big Pharma firms that made big cuts this year. Bristol-Myers (BMY) recently said it would have to go through another round of cuts as patents run out on drugs and price pressure from generics rise. The harsh environment and a forecast of a bad 2009 caused the firm to chop more than 8,000 people.

It is hard to believe that just 20 companies have cut over 400,000 people in less than a year, but it is only the tip of the iceberg.

Douglas A. McIntyre

Schwarzenegger orders mass layoffs, unpaid furloughs

Union leaders for state employees vow to challenge the legality of the mandatory time off, which amounts to about a 9% pay cut according to the governor's finance department.
By Patrick McGreevy and Jordan Rau December 20, 2008
Reporting from Sacramento -- Gov. Arnold Schwarzenegger on Friday ordered mass layoffs and unpaid furloughs for state workers starting in February to address California's growing fiscal crisis.Under his executive order, 238,000 employees will be forced to take off two unpaid days per month through June 30, 2010. Managers will receive either the furlough or an equivalent salary reduction during the same period.
H.D. Palmer, spokesman for Schwarzenegger's finance department, said the mandatory time off is the equivalent of about a 9% pay cut for affected workers. He said the furloughs would save the state more than $1.2 billion. It is unclear how many people will lose their jobs. Palmer said each department will have to cut its payroll by 10% and will make its own decisions on how many workers must go. Schwarzenegger attempted a few months ago to unilaterally reduce the pay of state employees, but his order never took effect. State Controller John Chiang said the state's payroll system was incapable of carrying it out.
Chiang did not comment on the viability of Schwarzenegger's new order, saying in a statement Friday that he had not seen the administration's implementation plan.The governor's order was condemned by officials of state employee unions, who vowed a legal challenge. Democratic legislative leaders voiced angry disappointment but said they were willing to return to negotiations with the Republican governor to solve the state's financial problems.A day after Schwarzenegger said he would veto an $18-billion package of cuts and new revenue adopted by the Legislature, he blamed lawmakers for the need to seek layoffs and other measures to reduce spending. "Our state's fiscal crisis has worsened dramatically in the past few weeks without legislative action to address our budget crisis," Schwarzenegger said in a letter to state employees Friday, after he declared another fiscal emergency and called a new special session of the Legislature.Lawmakers ended the previous special session Thursday with the passage of the $18-billion package forged by Democrats to shrink a $42-billion budget gap expected by mid-2010.Schwarzenegger asked the personnel department to work with state agencies to initiate "layoffs, reductions and other efficiencies" starting Feb. 1.Tens of thousands of employees, those in the bottom 20% of seniority, will receive "surplus" notices within the next month, said personnel officials, but not all who receive them will be laid off."I regret having to take these steps," Schwarzenegger wrote in his letter. "We simply have no choice. The emergency steps I am announcing will require sacrifice from everyone, including those in my own office." Aaron McLear, Schwarzenegger's spokesman, said it was unclear how many of the governor's staff will be laid off.Employee groups, including the Service Employees International Union Local 1000, said they would file a grievance with the state Public Employment Relations Board, charging that the governor's order is an unfair labor practice because workforce reductions are currently the subject of contract negotiations, according to Yvonne Walker, president of the local."The situation is out of control," said Walker, who represents 95,000 people, the largest number of unionized white-collar state workers. "With the state's economy heading towards a cliff, Gov. Schwarzenegger has pushed the state's fiscal crisis into catastrophe."Walker said the new layoffs will come on top of 10,000 job cuts made in the last year.The Assn. of California State Supervisors objected that managers were being singled out for potential pay cuts and layoffs on a day when the state unemployment rate rose to 8.4%, the worst in 14 years.Assembly Majority Leader Alberto Torrico (D-Newark) and other Democratic lawmakers issued a statement condemning the order by the governor, who negotiates state employee contracts."Arnold Schwarzenegger may be Hollywood royalty, but that doesn't make California a monarchy," the statement said. "Part of his core responsibility is to negotiate deals with employees."
Schwarzenegger's order prohibits state agencies from entering into new consulting contracts to cover the furloughs and layoffs.Additionally, he asked agencies not under his direct control, including the University of California, the California State University, California Community Colleges and the Legislature to implement layoffs and furloughs to cut their budgets.
Without these actions, the governor said, the state cash reserve is estimated to be a negative $5 billion in March. California is expected to run out of cash by February.Democratic legislative leaders said Friday that they were willing to go back to the bargaining table with Schwarzenegger to try to resolve the issues that led the governor to threaten a veto of their financial package.They believe differences over economic stimulus measures and relaxation of environmental laws for construction projects can be settled.
"We are far too close to let this $18-billion opportunity slip," said Senate President Pro Tem Darrell Steinberg (D-Sacramento). "We want to sit down with the governor as soon as possible."Assembly Speaker Karen Bass (D-Los Angeles) noted that the legislative package approved Thursday calls for $500 million in savings through unspecified workforce cuts. It would be up to Schwarzenegger to negotiate the cuts with employee unions.But in vowing to veto the legislation, the governor, she said, is "trying to pass off his responsibility onto us because he doesn't want to take the heat for that. That's not acceptable."She also objected to Schwarzenegger's demand that lawmakers incorporate every one of his budget ideas."It's like a child telling Santa, 'If you don't bring every single item on my list, then stay out of my chimney,' " Bass said.Steinberg and Bass said they would stay in Sacramento through the holidays to keep negotiations going. The governor spent Friday in Los Angeles and Fresno. "He seems to think that we need to be here all the time," Bass said. "He needs to be here and join us."McLear said Schwarzenegger is ready to keep talking, even by video conference."He'll meet with them whenever they want to," McLear said.

Orange County to lay off 210 social workers

Orange County to lay off 210 social workers
digg_url="http://bleedingjobs.blogspot.com/2008/12/orange-county-to-lay-off-210-social.html"
Source: LA Times
Orange County officials plan to hand out layoff notices to 210 social workers on Dec. 29, and are preparing to proceed with even more job cuts. The employees will be given two weeks notice before they lose their jobs.
The job cuts come in response to deep cuts expected to state funding of social services programs, officials said last week.
About one-third of the targeted workers process public assistance claims for the needy and unemployed, said Herman Martinez, president of the American Federation of State, County and Municipal Employees local in Orange County.
"The sad reality is we may one day see our co-workers in the lobby applying for benefits," he said. "There's not exactly an abundance of jobs out there, the way the economy is going."
An additional 4,000 social services employees will begin two weeks of mandatory unpaid leave in February.

OC Social Workers Face Layoffs

NOVELLUS SYSTEMS JOINS LAYOFF FRAY

San Jose - In what is becoming an almost daily occurrence, layoffs have been announced at another Silicon Valley company. Novellus Systems says it will be cutting 350 jobs, or about 10% of its workforce.

Novellus also says it is lowering its 4th quarter revenue estimates and cutting its CEO's salary in half. The company blames the economic downturn and expects to lose ten percent of its bookings, shipments and revenue for the 4th quarter.

It is unknown how many jobs in the Bay Area will be affected by the layoffs. The announcement comes on the heels of layoff notices by Adobe, Yahoo and Netflix.

1.5 million Californians out of work

County's jobless figure is highest since 1995

By Dean Calbreath

UNION-TRIBUNE STAFF WRITER

November 22, 2008

With thousands of jobs disappearing in retail, finance and construction, unemployment in California and San Diego County last month rose to its highest point since the recession of the early 1990s.

Statewide, the unemployment rate hit 8.2 percent in October, according to data released yesterday by the state's Employment Development Department and the U.S. Bureau of Labor Statistics. That's up from 7.7 percent in September and 5.7 percent in October 2007.

That was the third-highest rate in the nation after Michigan and Rhode Island, which were tied at 9.3 percent. The national average was 6.5 percent.

More than 1.5 million Californians are now unemployed, putting strains on the state's unemployment insurance fund, which was created during the Great Depression.

The state government projects that if current trends continue, the unemployment fund will be $2.4 billion in the red by the end of 2009, which would force it to borrow from the federal government for the second time in its history.

“We've known for years that changes must be made to the fund to keep it solvent, and it is unfortunate that now, when we need it most, it is racing toward the red,” Gov. Arnold Schwarzenegger said yesterday.

In the coming days, lawmakers will consider a proposal Schwarzenegger introduced this month that would require employers to pay more money into the unemployment fund while reducing the amount workers can receive.

In the meantime, President Bush signed a bill extending unemployment benefits nationwide to help jobless workers make it through the holidays.

“It's good news that President Bush is willing to extend the benefits,” said Murtaza Baxamusa, economist at San Diego's Center for Policy Initiatives. “But the idea of cutting back benefits would not just impact the folks who lose their jobs, but would also impact the economy, since there would be less money for them to spread around.”

In San Diego County, the jobless rate hit 6.8 percent – the highest point since summer 1995, when military contractors were closing their doors after the end of the Cold War. The unemployment rate was 6.1 percent in September 2008 and 4.8 percent in October 2007.

Between October 2007 and October 2008, the state lost 101,300 jobs, including 24,600 in the past month alone. San Diego County lost 12,200 jobs during the year, representing a decrease of nearly 1 percent.

Kelly Cunningham, economist at the San Diego Institute for Policy Research, said the number of people unemployed now tops the records set during the recession of the 1990s. He predicted the local jobless rate could eventually match or top its 1990s peak of 8.7 percent.

“It will only climb higher,” Cunningham said. “There doesn't seem to be an end to it right now. There has to be a pickup in the economy before businesses start adding jobs.”

Alan Gin, economist at the University of San Diego, said declining gas prices, a recent rise in home sales and the likelihood of a massive economic stimulus package once the Obama administration takes over in Washington could keep the economy from hitting the depths of the 1990s. But he said it's possible unemployment could top 8 percent.

Nigel Gault, economist with IHT Global Insight, an economic forecasting firm in Massachusetts, predicted that layoffs will accelerate as the economy deteriorates.

“Firms had previously been cutting back employment only gradually, being cautious on hiring but not aggressive on firing,” he said. “They have now decided that the recession will be deeper than feared and are acting more aggressively on firing, as they see demand for their products falling rapidly.”

According to yesterday's employment report, San Diego County added 400 workers last month, with most of the job growth coming from seasonal hiring at schools. After adjusting for those seasonal hiring fluctuations, the picture looks much gloomier.

Beacon Economics, a firm in Los Angeles that analyzes economic data, said that on a seasonally adjusted basis, San Diego lost 2,200 workers during the month, pushing the adjusted unemployment rate to 6.9 percent.

Because of the sluggish housing market, construction workers have taken the hardest hits. Over the past year, 5,800 such workers in San Diego County lost their jobs, including 500 in the past month, according to the Employment Development Department. Two hundred finance and real estate workers lost their jobs last month, bringing the yearly loss to 3,600.

The effects of the credit crunch have spread into retail sales, prompting layoffs at stores in the region. Over the past year, retailers have shed 4,600 jobs. Car dealerships cut 1,100; building supply and garden outlets, 800; department stores, 600; furniture dealers, 500; health and personal care boutiques, 500; and clothing shops, 400.

“This is a time of year when retailers are usually adding jobs for the Christmas holiday season, not cutting existing jobs,” Cunningham said. “That's very unusual. Even during the 1990s recession, hiring at retailers usually picked up at this time of year.”

Unemployment is increasing in other areas as well, including manufacturing, government and professional services. Employment for temporary workers dropped by 400 jobs last month, for a yearly loss of 2,500.

The employment firm Manpower is an exception. Phil Blair, a co-owner of the firm's regional operations, said business is strong.

“There are still some jobs out there – especially in places like computer programming, high tech, biomedical, telecom and medical device manufacturing,” he said. “It's just that people have to look longer, harder and deeper and in less predictable places.”

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Dean Calbreath: (619) 293-1891; dean.calbreath@uniontrib.com 

El Dorado County Facing Worker Cuts

Job Layoffs Underscore Tough Economic Times on the Central Coast

VS pegs Longs layoffs at 800

By George Avalos Staff Writer Article Launched: 10/30/2008 03:52:46 PM PDT WALNUT CREEK — About 800 Longs Drug Stores corporate employees who work in the East Bay will lose their jobs, starting this year, as a result of the company's purchase by fellow drug retailer CVS Caremark, CVS disclosed Thursday. The positions affected are in the headquarters and other offices in Walnut Creek, as well as a secondary corporate office in Antioch. The affected employees have been notified. CVS completed its $2.7 billion purchase of Longs on Thursday. "We did anticipate overlap in our corporate functions and after careful evaluation estimate 800 positions will be affected," said Eileen Dunn, a senior vice president with Rhode Island-based CVS Caremark. The primary job categories that are affected include administrative, human resources, I.T. (information technology) and other operations. "Within the next several months, we plan to release these employees from Longs corporate operations and to close corporate facilities in Walnut Creek and Antioch," Dunn said. The facilities include two Longs Drug's corporate operations in Walnut Creek: the company headquarters downtown and an office in the Shadelands business center northeast of the downtown. During a conference call to discuss financial results for its third quarter of 2008, Thomas Ryan, CVS chairman, president and chief executive officer, provided some details about the timing for an array of events that will affect corporate operations and retail sites. "We will not disrupt the stores during the holiday season for obvious reasons," Ryan told analysts. "So the integration will really start in the first quarter of 2009." Among the key events in the time line to bring the former Longs operations fully into the CVS fold: Conversion of store electronic systems should begin by March and be complete by the end of May. The corporate offices will close by the end of the summer. About 80 percent of the corporate operations should be closed by June. Renaming and remodeling of stores should start by mid-March and be completed by mid-October. "Longs will be fully integrated by the fourth quarter of 2009," Ryan said. In an earlier proxy filing, Longs disclosed the severance pay that several Longs executives received severance packages, sometimes known as "golden parachutes," because of the change of ownership: Warren Bryant, president and chief executive officer, a $23.6 million severance package. Steven McCann, chief financial officer, a $6.6 million severance. Bruce Schwallie, executive vice president, a $4.8 million severance. In addition, on Oct. 22, Bryant filed papers with regulators that detailed his sale this month of 515,000 shares of Longs stock options or other derivatives at prices ranging from $22.45 to $27.40. The combined value of the shares sold, based on the listed price per share, was $12.7 million. "The mood by many at the office is despondent," said one employee who expects to be laid off and who requested anonymity. "Many of the employees have worked for Longs for many years and feel a sense of loss as Longs has been a local and family-run organization for many years." One employee also noted that the job cuts come during a tough period. "Compounding the normal sensitivity of job loss is the timing of this acquisition during very difficult economic times," the employee said. "We are all very concerned with the ability to find employment in this difficult market." These employees who are affected will be eligible for a transition package to cover financial and health benefits, outplacement support and counseling, CVS spokeswoman Dunn said. "Only a small fraction of Longs are affected and we envision that the vast majority of the more than 22,000 Longs employees will continue to be part of the combined company," Dunn said. George Avalos covers jobs, economic development, commercial real estate, finance and oil companies. Reach him at 925-977-8477 or gavalos@bayareanewsgroup.com

O.C. Register to lay off 110 workers

The Orange County Register will lay off about 110 employees by the end of the week, Register Publisher Terry Horne announced today.

The workers, who are being notified today and Thursday, will receive the company’s standard severance package of two weeks’ pay for every year of service, Horne said. State law for layoffs of 50 people or more also requires employers to provide the workers with two-months’ pay or two-months notice of layoff.

Horne said the layoffs were part of an on-going effort to tailor the newspaper’s business model to a media environment that has been hard hit by a loss of employment, auto and real estate advertising; a drop in readership; a sour economy and increased competition from the Internet.

“This isn’t necessarily just to improve profitability, we have to become a different kind of company,” Horne said. “We will be more focused on Interactive and make more of an effort in the print business.”

Newspapers nationwide, including the New York Times and the Los Angeles Times, have been cutting staff as they try to adjust to the new financial realities of publishing.

Horne said he didn’t plan any immediate changes in the Register similar to those earlier in the year, when the company eliminated the stand-alone Marketplace section six days a week. The company, however, will continue to focus on news in Orange County that readers cannot get anywhere else, he said.

This is the Register’s fourth round of layoffs this year. The company also had layoffs in August 2007 and a voluntary severance program to cut staff in 2006. This latest layoff, which includes about 30 in the newsroom, will leave Orange County Register Communications with a staff of about 1,230, Horne said.

Horne said that while the company is facing challenging times, there are some areas of success. Online advertising, excluding employment, was up 69.3% over last year, he said. Revenues from direct mail were up 16%, Horne said. The Register is privately owned and does not release financial information.

Although the Audit Bureau of Circulation reported that the Register’s circulation declined to 236,270 daily (down 15%) and 298,410 (down 8.2%) in the year ended Sept. 30, Horne said most of it was a deliberate reduction in papers distributed to hotels, schools and other bulk delivery that is not valued by advertisers.

Home delivery, which is highly valued by advertisers, basically remained flat for the six months ended in September. Circulation on Thursday through Sunday, which are the biggest advertising days, rose 0.6%, Horne said.

California unemployment holds steady at 7.7%

The September number does not reflect the more recent financial crisis. Economists predict that unemployment will rise.

By Marc Lifsher, Los Angeles Times Staff Writer
October 18, 2008

SACRAMENTO -- California's unemployment rate held steady at 7.7% in September, remaining at its highest level in 12 years. Economists warned Friday that joblessness is likely to jump once October numbers are tallied.

The new data from the California Employment Development Department reflect a continually weakening state economy buffeted by falling home prices, little construction activity, declining consumer demand and government belt-tightening.

The paralysis in housing and lending has been particularly tough on Kathleen Thompson-Boons, 59, of Watts. She lost her job as a loan funder a year ago. "Every day I'm on the Internet, sending out my resume," she said. "But nothing comes out of it. I've only had one interview."

Now she says she'd be satisfied to land a $10-an-hour job doing medical billing or retail sales, if she could find one.

What the new state numbers did not show was the effect of a global financial crisis that froze credit and panicked stock markets beginning in mid-September, just after the monthly employment surveys were conducted.

"The economic situation has deteriorated dramatically in the last month, and, unfortunately, I think the snowball is gaining momentum," said Sung Won Sohn, an economist at Cal State Channel Islands. "It's going to get worse."

Sohn, who also is vice chairman of clothing-store chain Forever 21 Inc., predicted that October's figures would show "significant layoffs" in financial services and retail trade. "Most retailers expect this holiday shopping season to be at best flat in dollar terms and be down in volume terms," he said.

One major retailer, the Mervyns department-store chain, announced Friday that it would mark the upcoming holidays with a going-out-of-business sale. The Hayward company is closing 149 stores, mainly in California, and eliminating more than 10,000 jobs.

Perhaps heralding a grim sales season, a Reuters/University of Michigan survey, released Friday, showed a record single-month drop in consumer confidence in October.

The index buttressed a report Thursday from the federal government that retail sales fell 1.2% in September, the most severe decline in three years.

Retail's poor prospects could further weaken a state economy that lost 77,200 jobs between September 2007 and September 2008, according to the Employment Development Department. The biggest declines were in construction; financial activities, including the mortgage industry; and manufacturing.

Economists credited much of last month's leveling-off to the seasonal return of thousands of teachers to school and university classrooms.

The jump in education work contributed to a statistically insignificant drop in unemployment in the Los Angeles metropolitan area, to 7.8% in September from 7.9% in August.

One sure sign that consumers might be acting a little Scrooge-like at Christmas is a slowdown in container traffic in September at the ports of Los Angeles and Long Beach, said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. Although volume jumped from August to September, reflecting the arrival of imports for the holidays, it was 12% below September 2007's totals.

"If the stores were honest, they would tell you they wish they hadn't placed a lot of those orders," Kyser said.

The bad news out of the shopping malls is evidence that "California is moving from a housing-driven slowdown to a consumer-driven recession," said Stephen Levy, director and chief economist at the Center for Continuing Study of the California Economy in Palo Alto.

Consumers, he said, "are being hit with a triple whammy of rising job losses, sharp drops in their housing and stock-market wealth and tightening access to credit."

As a result, California could wallow in the economic mud for much of next year, with unemployment possibly hitting 9%, Levy said.

California's economy can't grow without credit and people eager to buy new cars, home furnishings and high-end electronic equipment, said Howard Roth, chief economist for the state Department of Finance.

"It's worrisome," he said. "If you lose the consumer, there's not enough there to keep the rest of the economy going."

marc.lifsher@latimes.com

United Airlines announces lay off of 414 mechanics

On Wednesday, United Airlines released a statement indicating that it would be laying off 414 of its San Francisco-based mechanics.

The new layoffs are part of the 7,000 job cuts that the Chicago-based airline announced earlier this year, as it continues to cut back on flights and eliminate the Boeing 737s from its fleet.

A spokeswoman for United, Megan McCarthy, explained that the layoff notices were sent to the mechanics on September 29, for layoffs effective December 7.

The Teamsters Local 856, located in San Bruno, California, which represents the mechanics who are being laid off have said they are outraged that the mechanics are being replaced by overseas outsourcing of their work. A spokesman for the Teamsters, Paul Molenberg, said that in addition to the loss of jobs, the aircraft maintenance will done by less-qualified workers.

All employee groups at United are seeing reductions in workforce. Involuntary layoffs among flight attendants were avoided, as there were sufficient numbers of volunteers for furloughs, reducing the number of cabin staff by 1,550. Efforts to reduce the number of pilots by 950 will continue into 2009, according to McCarthy, and as many as 1,600 management positions will be cut as well.

The number of job cuts in the baggage handler and customer service employees groups are yet to be announced.