Siemens job cuts to impact many engineering posts

Straightening out rumors and report that circulated, Siemens has finally specified its planned job cuts, which against earlier announcements of CEO Peter Loescher, will cover many engineering positions.

In order to improve the margins of the electronics group, Loescher plans to reduce the complexity of the company with its currently 475,000 employees, spread over more than 100 countries.

In addition to the restructuring Loescher has implemented in January 2008, which reduced the number of business units from eight to three, the company plans to merge its currently 70 regional organizations into 20 so-called Clusters; 1,800 legally independent subsidiaries and activities will be reduced to less than 1,000 by 2010.

The measures also include worldwide job cuts as the company plans to reduce the number of employees by 16,750. Of this number, about 5,250 jobs in Germany will be affected, with the largest Siemens locations Erlangen, Munich, Nuremberg and Berlin contributing the highest number of job cuts.

The industry segment will suffer a hard blow. In order to raise the margins, the segment will establish standardized platforms for its mobility division, which is part of the industry activities. Besides the creation of the standard platforms, the head count in that business segment will be reduced by 2,500 employees worldwide, 1,800 of them in engineering and production functions. Most of the job cuts will occur in Europe including Germany.

Electronics assembly, another unit under scrutiny, will lose 330 employees through process simplifications, 250 of them in Germany.

In the healthcare segment, Siemens plans to cut about 1,550 jobs, which according to official statements, will mostly be administration functions. In healthcare, U.S.-based activities will be affected disproportionately high, with 1,200 of the 1,550 job cuts to be made in the United States, primarily in imaging and IT as well as in the workflow solution divisions.

On top of these job cuts, Siemens also plans to reduce the staff it its IT solutions and services business, which over many years was the company's problem child, apparently resistant against all measures to improve its productivity.

- Christoph Hammerschmidt
EE Times Europe