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August 01, 2005

More Problems for Western Europe Manufacturing

Today's Wall Street Journal reports on the troubles that lie ahead for Western Europe's manufacturing workers.

Western Europe's Labor Woes  (Subscription Required)

FRANKFURT -- A number of multinational companies are cutting jobs more heavily in Western Europe than in other regions, highlighting how sluggish growth and structural problems in many European countries are driving away investment.

Among the recent examples, International Business Machines Corp. said in late July that of its 14,500 planned layoffs, 70% would fall on Europe, mainly in Germany, France and Italy -- the three economies that dominate the euro currency area. Household-appliance maker Electrolux AB of Sweden is evaluating 27 factories for possible closure, as part of a strategy to shift the focus of its production from high-wage Western Europe to cheaper countries, especially in Eastern Europe and Mexico. Car maker General Motors Corp. is currently shedding 12,000 employees in Europe, including nearly a third of its 32,000-strong German work force -- a proportionately deeper cut than its parallel cost-cutting measures in the U.S.

August 1, 2005 in Comparative Labor Relations, Globalization | Permalink

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