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Emerson eliminating 2,900 jobs in cost-reduction effort

Emerson eliminating 2,900 jobs in cost-reduction effort

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Emerson announced a major restructuring Thursday that will eliminate 2,900 salaried jobs and close as many as 145 facilities.

Chief Executive David Farr, speaking at an investor presentation in New York, told analysts that the moves were in response to slowing global demand for Emerson's products, which include factory automation systems and air-conditioning compressors.

Emerson employs 88,000 people worldwide, 39,000 of whom are in salaried positions such as engineers, managers and sales staff. Farr said about 2,900 such jobs would be eliminated and 1,000 more people might be asked to relocate.

A spokesman said the effects would be minimal at Emerson's Ferguson headquarters, which has 1,400 employees.

Farr said the company would "consolidate" about 145 facilities, including sales offices and service centers along with factories. He said Emerson also would "invest in new capacity in best-cost locations."

Those locations include India, Mexico and Eastern Europe, he said. 

Farr said the cost-cutting measures would save Emerson $450 million a year by 2023. Most of the measures are expected to happen this year or next.

Farr said discussions about a restructuring began last March or April, when Emerson started seeing a slowdown in orders.

Farr made no mention of DE Shaw, the activist hedge fund that criticized Emerson last October for having excessive costs. He did say, however, that Emerson had decided not to split itself in two, which was one of the actions recommended by DE Shaw.

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