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Business

Siemens Sheds Another 7,000 Jobs

The electronics and engineering giant said it will cut 7,000 jobs, this time at its loss-making industrial solutions division, which will narrow its focus on three core activities in order to increase competitiveness.

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Siemens is one of Germany's largest companies

Electronics and engineering giant Siemens AG announced that it will cut 7,000 jobs in its industrial solutions division with 5,000 of them to go in Germany. In detail, Siemens said that it plans to shed 5,000 jobs through divestments, while the remaining 2,000 are to be cut in a socially responsible manner. This means that the industrial solutions division will see its workforce reduced by almost a quarter from the current 30,000.

Industrial Solutions and Services (I&S) claims to be the global leader in supplying industrial plants and related maintenance services. Last year it had revenues of 4.6 billion euro, but in the current quarter, the unit unexpectedly slid into the red with a loss of 39 million euro. At the same time incoming orders declined by 12 percent. Semens cited the weak economy and the cut in industry investments as the main reasons for I&S’s pore performance.

Although a restructuring plan for I&S was already announced by Siemens chief Heinrich von Pierer back in April, the level of the planned cutbacks came as a surprise. I&S chief Jörgen Ole Haslestad said that costs were to be reduced by half a billion eruo. In future the division will narrow its focus on three areas: the construction of industrial plants, infrastructure projects, and IT solutions for production processes. A workforce of 23, 000 is to generate revenues of around 4 billion euro in the future, Haslestad said.