American Express to Cut Up to 5,000 Jobs
American Express Co. will eliminate between 4,000-5,000 jobs in its third quarter, on top of the 1,600 positions it eliminated, or announced its intent to eliminate, earlier this year. The reductions will come through a combination of outsourcing and staff reductions.
The most recent figures put employee levels at 89,000.
The cuts would come from outsourcing or consolidating some in-house functions, such as data processing. The company’s Technologies group, along with finance, operations, human resources and support staff sectors will all have staff levels cut. Some of the customer service, finance and operations will be moved to cheaper overseas locations.
Additionally, American Express will aggressively move both internal and external operations to automated functions on the Internet, allowing it to absorb changes in travel sales as the economy improves without adding additional staff.
The New York-based financial services firm also said that its consolidated net income for the second quarter would be approximately $714 million, 5% lower than second-quarter 2000’s level.
The company expects to take a one-time charge of between $310-$370 million as a result of the reductions, but will realize annual savings of $275 to $300 million in 2002, and $345-$370 million thereafter.
