www.jobberz.com
(CEP News) - The upside surprise in U.S. initial jobless claims points to a continued deterioration of the U.S. labour market, and the possible loss of up to 750,000 jobs in February's official nonfarm payrolls report. Initial claims rose to 667k in the week ending Feb. 21, well above the 625k level economists had expected. The previous week's reading was also upwardly revised to 631k, the U.S. Department of Labor reported.
Continuing claims rose above expectations as well, coming in at 5.112 million compared to the 5.025 million expected.
Ken Maylan of ClearView Economics called the rise in initial claims "painful," but noted that on an adjusted basis, weekly claims exceeded 1 million claims in the 1982 recession.
The continued increase in claims isn't likely to end any time soon, according to HFE economist Ian Shepherdson. However, he also noted that the current level is still well short of the peaks reached in the mid-1970s and early 80s.
"We fervently hope that does not happen but we are not confident," he said in a client note. "Companies are throwing in the towel as they recognize that no sector is safe."
As a result, Shepherdson is forecasting February's official nonfarm payrolls report to show a loss of up to 750,000 jobs. That would follow a record loss of 598,000 jobs in January, which boosted the unemployment rate 0.6 percentage points to 7.2%.
Also in Thursday's jobless claims report, the less volatile four-week moving average for initial claims rose to 639,000, up from 620,000 in the week prior, while the four-week moving average for continuing claims rose to 4.932 million, up from 4.843 million in the previous week.
By Stephen Huebl, shuebl@economicnews.ca, edited by Sarah Sussman, ssussman@economicnews.ca
CEP Newswires - CEP News ? 2008. All Rights Reserved. www.economicnews.ca
The Copying, Broadcast, Republication or Redistribution of CEP News Content is Expressly Prohibited Without the Prior Written Consent of CEP News.
A copy of CEP News disclaimer can be found at http://www.economicnews.ca/cepnews/wire/disclaimer.
Thursday, February 26, 2009
Thrifts lost $3B in 4Q; post record annual loss
www.jobberz.com
By DANIEL WAGNER –
WASHINGTON (AP) — U.S. thrifts lost $3 billion in the fourth quarter and more than $13 billion last year, a record annual loss.
The Office of Thrift Supervision said Thursday that net losses last year surged to $13.44 billion, from $649 million in 2007. But the fourth-quarter loss was actually better than the $4.4 billion loss in the prior quarter and the $8.8 billion loss in the year-ago period.
Thrifts last year set aside $38.7 billion for losses on bad mortgages and other loans, the highest point since 1991, due mainly to increased mortgage delinquencies.
"While painful to the bottom line, the industry is better positioned to absorb loan losses," said James Caton, OTS director of financial monitoring.
Thrifts are important to consumer lending because they must have at least 65 percent of their lending in mortgages and other consumer loans.
But troubled assets now account for more than 2.5 percent of assets, up from nearly 1.7 percent a year ago.
Thrifts need to set aside so much money for loan losses because home prices likely will continue dropping "for some time," said OTS economist Sharon Stark. Northeastern cities with strong financial services industries will be especially hard hit, she added.
The yearly results exclude Seattle-based thrift Washington Mutual Inc., whose failure in September was the largest in U.S. history, and Pasadena, Calif-based IndyMac Bank, which failed in July. Their performance is included in 2007 figures.
JPMorgan Chase & Co., which acquired Washington Mutual's assets, said Thursday it will eliminate about 12,000 jobs as it folds in the company's operations.
There were 26 problem thrifts at the end of 2008, up from 11 a year earlier, but OTS director John Reich said two-thirds of the lending institutions remain profitable.
"What started out to be a housing problem ... has expanded to the broader economy," and now affects virtually all businesses and financial institutions, Reich said.
The agency, a part of the Treasury Department, is working with other regulators on a plan to streamline loan modifications. Thrift mortgage origination fell 43 percent last year to $404.9 billion from $716.2 billion in 2007.
Separately, Reich said the agency is launching a new unit to monitor thrifts with more than $10 billion in assets. The new "large bank unit" will be working onsite at about 25 thrifts.
The agency also will create new standards for reviewing enforcement actions on thrifts that do not meet minimum standards.
By DANIEL WAGNER –
WASHINGTON (AP) — U.S. thrifts lost $3 billion in the fourth quarter and more than $13 billion last year, a record annual loss.
The Office of Thrift Supervision said Thursday that net losses last year surged to $13.44 billion, from $649 million in 2007. But the fourth-quarter loss was actually better than the $4.4 billion loss in the prior quarter and the $8.8 billion loss in the year-ago period.
Thrifts last year set aside $38.7 billion for losses on bad mortgages and other loans, the highest point since 1991, due mainly to increased mortgage delinquencies.
"While painful to the bottom line, the industry is better positioned to absorb loan losses," said James Caton, OTS director of financial monitoring.
Thrifts are important to consumer lending because they must have at least 65 percent of their lending in mortgages and other consumer loans.
But troubled assets now account for more than 2.5 percent of assets, up from nearly 1.7 percent a year ago.
Thrifts need to set aside so much money for loan losses because home prices likely will continue dropping "for some time," said OTS economist Sharon Stark. Northeastern cities with strong financial services industries will be especially hard hit, she added.
The yearly results exclude Seattle-based thrift Washington Mutual Inc., whose failure in September was the largest in U.S. history, and Pasadena, Calif-based IndyMac Bank, which failed in July. Their performance is included in 2007 figures.
JPMorgan Chase & Co., which acquired Washington Mutual's assets, said Thursday it will eliminate about 12,000 jobs as it folds in the company's operations.
There were 26 problem thrifts at the end of 2008, up from 11 a year earlier, but OTS director John Reich said two-thirds of the lending institutions remain profitable.
"What started out to be a housing problem ... has expanded to the broader economy," and now affects virtually all businesses and financial institutions, Reich said.
The agency, a part of the Treasury Department, is working with other regulators on a plan to streamline loan modifications. Thrift mortgage origination fell 43 percent last year to $404.9 billion from $716.2 billion in 2007.
Separately, Reich said the agency is launching a new unit to monitor thrifts with more than $10 billion in assets. The new "large bank unit" will be working onsite at about 25 thrifts.
The agency also will create new standards for reviewing enforcement actions on thrifts that do not meet minimum standards.
Apple Board Forced Into Spotlight With Jobs on Leave
www.jobberz.com
By Connie Guglielmo
Feb. 26 (Bloomberg) -- Apple Inc.’s directors, after taking a back-seat role for years to Chief Executive Officer Steve Jobs, were forced to respond to investors yesterday as they pushed for an update on Jobs’s health.
Apple’s co-lead directors, Arthur Levinson and Bill Campbell, each answered questions at the company’s annual meeting on how the board has handled disclosures about Jobs’s health, succession planning and executive pay at Apple. In past years, Jobs has dominated the meeting, with board members sitting quietly in the first row of the audience.
“The dynamism of him controlling the meeting has changed,” Scott Adams, a representative of the American Federation of State, County and Municipal Employees, said in an interview after the meeting. His organization owns 18,218 Apple shares. In the past, “Jobs would not allow questions to go to directors.”
Standing up to address a packed room, Levinson, the CEO of Genentech Inc., said yesterday that “nothing has changed,” since Apple’s disclosure on Jan. 14 that Jobs was taking a five- month medical leave.
“He certainly remains the CEO -- he’s responsible and deeply involved in all strategic matters,” said Levinson, who’s served on Apple’s board since 2000. “If there’s new information that we deem important to disclose, that will happen. At this point we feel we’ve met all disclosure obligations and responsibilities.”
Apple’s Disclosures
Corporate governance experts have faulted Apple’s board, which includes former U.S. Vice President Al Gore and Google Inc. CEO Eric Schmidt, for not talking about Jobs’s health sooner and in more detail after concern about his weight loss last year caused movements in the stock price. Jobs, a cancer survivor, missed the annual meeting for the first time in more than a decade.
While giving shareholders updates isn’t a hard and fast rule, Apple’s board will probably be compelled to talk more about Jobs’s health if anything changes significantly, said Jahan Raissi, a partner at Shartsis Friese LLP in San Francisco. He was a former senior counsel in the enforcement division of the Securities and Exchange Commission.
“If in two months it comes out that something changed and people knew two months ago and they didn’t say anything, there could be hell to pay,” Raissi said in an interview. “If they don’t say anything more, then it’s reasonable to believe that the company doesn’t know any different information.”
Apple rose 93 cents to $92.09 at 9:33 a.m. New York time in Nasdaq Stock Market trading. The shares had gained 6.8 percent this year before today.
Biggest Assembly
Yesterday’s gathering -- held in the same auditorium at Apple’s Cupertino, California, headquarters where Jobs typically introduces new products -- was the biggest public assembly of directors at an annual meeting in the past three years.
Levinson and Intuit Inc. Chairman Campbell, seated in the front row, were flanked by four other independent directors: Gore, J. Crew Inc. CEO Millard “Mickey” Drexler, Avon Inc. CEO Andrea Jung and former International Business Machines Corp. finance chief Jerome York. The only board members absent were Jobs and Schmidt.
Last year, Jobs was joined by Gore, Schmidt, Levinson and Campbell. In 2007, Levinson, Campbell and Schmidt also attended.
On Jan. 5, Jobs said treatment for his weight loss was “relatively simple.” Nine days later, he announced he would take leave after learning his health issues were “more complex” than he originally thought.
SEC Probe
The SEC started an investigation into the disclosures to determine whether investors were misled, a person familiar with the matter said last month. The review doesn’t mean investigators have seen evidence of wrongdoing. Apple general Counsel Daniel Cooperman declined to comment on the SEC investigation yesterday.
Jobs, who co-founded Apple in 1976 and was ousted in a management coup in 1985, returned to lead the company in 1997. One of the first things he did was to replace all but two of the board members. His picks included Campbell, a former Apple executive, and York, an adviser to Tracinda Corp. CEO Kirk Kerkorian.
“It’s a very secretive culture, a very closed culture,” said Conrad Mackerron, director of corporate social responsibility for As You Sow, an environmental advocacy group in San Francisco. The group, which met with Jobs two years ago to talk about Apple’s environmental policies, submitted a shareholder proposal asking that the company provide more details on its effort to cut carbon emissions. “It’s hard to talk in an open manner.”
No Mobile Phones
Only shareholders were allowed into the meeting hall and able to ask questions. Reporters, and latecomers, watched the 75-minute event on video in a separate room. Apple banned the use of mobile phones, personal computers, cameras and recording devices. Apple typically doesn’t make a transcript of the event available.
Campbell, 68, used his time at the microphone to talk about the board’s decision to vote against a “say-on-pay” proposal. Campbell said the board wanted to retain the flexibility to reward executives as “we see fit.”
“You can sense there’s more disclosure,” in that board members were forced to answer questions, said Gene Munster, an analyst with Piper Jaffray & Co. in Minneapolis, who has recommended investors buy Apple’s shares since June 2004. “It’s a good thing that Apple is more transparent.”
Investors still want more information, said Andy Hargreaves, an analyst at Pacific Crest Securities in Portland, Oregon.
“If I was a shareholder, I would have been upset if I heard them say, ‘He was fine, it’s a hormone imbalance’ and then nine days later, hear him say ‘I’m taking leave,’” said Hargreaves, who rates Apple shares “outperform.” “That’s misleading at best. It’s possible that things change that quickly. That’s why the lack of disclosure is disconcerting.”
To contact the reporter on this story: Connie Guglielmo in San Francisco at cguglielmo1@bloomberg.net
By Connie Guglielmo
Feb. 26 (Bloomberg) -- Apple Inc.’s directors, after taking a back-seat role for years to Chief Executive Officer Steve Jobs, were forced to respond to investors yesterday as they pushed for an update on Jobs’s health.
Apple’s co-lead directors, Arthur Levinson and Bill Campbell, each answered questions at the company’s annual meeting on how the board has handled disclosures about Jobs’s health, succession planning and executive pay at Apple. In past years, Jobs has dominated the meeting, with board members sitting quietly in the first row of the audience.
“The dynamism of him controlling the meeting has changed,” Scott Adams, a representative of the American Federation of State, County and Municipal Employees, said in an interview after the meeting. His organization owns 18,218 Apple shares. In the past, “Jobs would not allow questions to go to directors.”
Standing up to address a packed room, Levinson, the CEO of Genentech Inc., said yesterday that “nothing has changed,” since Apple’s disclosure on Jan. 14 that Jobs was taking a five- month medical leave.
“He certainly remains the CEO -- he’s responsible and deeply involved in all strategic matters,” said Levinson, who’s served on Apple’s board since 2000. “If there’s new information that we deem important to disclose, that will happen. At this point we feel we’ve met all disclosure obligations and responsibilities.”
Apple’s Disclosures
Corporate governance experts have faulted Apple’s board, which includes former U.S. Vice President Al Gore and Google Inc. CEO Eric Schmidt, for not talking about Jobs’s health sooner and in more detail after concern about his weight loss last year caused movements in the stock price. Jobs, a cancer survivor, missed the annual meeting for the first time in more than a decade.
While giving shareholders updates isn’t a hard and fast rule, Apple’s board will probably be compelled to talk more about Jobs’s health if anything changes significantly, said Jahan Raissi, a partner at Shartsis Friese LLP in San Francisco. He was a former senior counsel in the enforcement division of the Securities and Exchange Commission.
“If in two months it comes out that something changed and people knew two months ago and they didn’t say anything, there could be hell to pay,” Raissi said in an interview. “If they don’t say anything more, then it’s reasonable to believe that the company doesn’t know any different information.”
Apple rose 93 cents to $92.09 at 9:33 a.m. New York time in Nasdaq Stock Market trading. The shares had gained 6.8 percent this year before today.
Biggest Assembly
Yesterday’s gathering -- held in the same auditorium at Apple’s Cupertino, California, headquarters where Jobs typically introduces new products -- was the biggest public assembly of directors at an annual meeting in the past three years.
Levinson and Intuit Inc. Chairman Campbell, seated in the front row, were flanked by four other independent directors: Gore, J. Crew Inc. CEO Millard “Mickey” Drexler, Avon Inc. CEO Andrea Jung and former International Business Machines Corp. finance chief Jerome York. The only board members absent were Jobs and Schmidt.
Last year, Jobs was joined by Gore, Schmidt, Levinson and Campbell. In 2007, Levinson, Campbell and Schmidt also attended.
On Jan. 5, Jobs said treatment for his weight loss was “relatively simple.” Nine days later, he announced he would take leave after learning his health issues were “more complex” than he originally thought.
SEC Probe
The SEC started an investigation into the disclosures to determine whether investors were misled, a person familiar with the matter said last month. The review doesn’t mean investigators have seen evidence of wrongdoing. Apple general Counsel Daniel Cooperman declined to comment on the SEC investigation yesterday.
Jobs, who co-founded Apple in 1976 and was ousted in a management coup in 1985, returned to lead the company in 1997. One of the first things he did was to replace all but two of the board members. His picks included Campbell, a former Apple executive, and York, an adviser to Tracinda Corp. CEO Kirk Kerkorian.
“It’s a very secretive culture, a very closed culture,” said Conrad Mackerron, director of corporate social responsibility for As You Sow, an environmental advocacy group in San Francisco. The group, which met with Jobs two years ago to talk about Apple’s environmental policies, submitted a shareholder proposal asking that the company provide more details on its effort to cut carbon emissions. “It’s hard to talk in an open manner.”
No Mobile Phones
Only shareholders were allowed into the meeting hall and able to ask questions. Reporters, and latecomers, watched the 75-minute event on video in a separate room. Apple banned the use of mobile phones, personal computers, cameras and recording devices. Apple typically doesn’t make a transcript of the event available.
Campbell, 68, used his time at the microphone to talk about the board’s decision to vote against a “say-on-pay” proposal. Campbell said the board wanted to retain the flexibility to reward executives as “we see fit.”
“You can sense there’s more disclosure,” in that board members were forced to answer questions, said Gene Munster, an analyst with Piper Jaffray & Co. in Minneapolis, who has recommended investors buy Apple’s shares since June 2004. “It’s a good thing that Apple is more transparent.”
Investors still want more information, said Andy Hargreaves, an analyst at Pacific Crest Securities in Portland, Oregon.
“If I was a shareholder, I would have been upset if I heard them say, ‘He was fine, it’s a hormone imbalance’ and then nine days later, hear him say ‘I’m taking leave,’” said Hargreaves, who rates Apple shares “outperform.” “That’s misleading at best. It’s possible that things change that quickly. That’s why the lack of disclosure is disconcerting.”
To contact the reporter on this story: Connie Guglielmo in San Francisco at cguglielmo1@bloomberg.net
Limited Predicts First-Quarter Loss, Cuts 400 Jobs
www.jobberz.com
By Allison Abell Schwartz
Feb. 26 (Bloomberg) -- Limited Brands Inc., the owner of the Victoria’s Secret chain, predicted a first-quarter loss and cut 400 jobs as consumers reduce spending on lingerie.
The loss will be 7 cents to 12 cents a share, the Columbus, Ohio-based company said today. Eight analysts estimated profit of 2 cents a share, on average. Sales at stores open at least a year may decline by “high-single digits” on a percentage basis, executives said on a conference call with investors and analysts.
Saks Inc. and Macy’s Inc. are among retailers eliminating jobs to slash costs as declining home values and the highest unemployment in 16 years cause consumers to reduce spending. Limited is also suspending pay increases, reducing capital spending and slowing store growth, Chief Administrative Officer Martyn Redgrave said on the call.
“There is extraordinary uncertainty and lack of visibility in all of our businesses,” Redgrave said. “In this unprecedented environment, we are choosing to take aggressive actions.”
Limited fell 73 cents, or 8.2 percent, to $8.19 at 11:52 a.m. in New York Stock Exchange composite trading. The shares lost 11 percent this year before today.
Fourth-quarter net income dropped 96 percent to $16.1 million, or 5 cents a share, after a writedown on the value of its La Senza brand. Revenue fell 8.7 percent to $2.99 billion.
The retailer took a charge in the period for the elimination of about 10 percent of the jobs at its corporate headquarters. Most of the jobs cut at Limited Brands will remain on its payroll until March 7, spokeswoman Tammy Roberts Myers said in an e-mail.
Profit excluding the pretax impairment charge and severance costs was 68 cents a share, the company said. Fourteen analysts surveyed by Bloomberg estimated profit of 65 cents.
Full-year profit will be 60 cents to 85 cents, the company said. Fourteen analysts estimated profit of 88 cents, on average.
Limited’s 3,014 retail locations include Bath & Body Works and Henri Bendel as well as Victoria’s Secret.
To contact the reporter on this story: Allison Abell Schwartz in New York at aabell@bloomberg.net.
Last Updated: February 26, 2009 11:55 EST
By Allison Abell Schwartz
Feb. 26 (Bloomberg) -- Limited Brands Inc., the owner of the Victoria’s Secret chain, predicted a first-quarter loss and cut 400 jobs as consumers reduce spending on lingerie.
The loss will be 7 cents to 12 cents a share, the Columbus, Ohio-based company said today. Eight analysts estimated profit of 2 cents a share, on average. Sales at stores open at least a year may decline by “high-single digits” on a percentage basis, executives said on a conference call with investors and analysts.
Saks Inc. and Macy’s Inc. are among retailers eliminating jobs to slash costs as declining home values and the highest unemployment in 16 years cause consumers to reduce spending. Limited is also suspending pay increases, reducing capital spending and slowing store growth, Chief Administrative Officer Martyn Redgrave said on the call.
“There is extraordinary uncertainty and lack of visibility in all of our businesses,” Redgrave said. “In this unprecedented environment, we are choosing to take aggressive actions.”
Limited fell 73 cents, or 8.2 percent, to $8.19 at 11:52 a.m. in New York Stock Exchange composite trading. The shares lost 11 percent this year before today.
Fourth-quarter net income dropped 96 percent to $16.1 million, or 5 cents a share, after a writedown on the value of its La Senza brand. Revenue fell 8.7 percent to $2.99 billion.
The retailer took a charge in the period for the elimination of about 10 percent of the jobs at its corporate headquarters. Most of the jobs cut at Limited Brands will remain on its payroll until March 7, spokeswoman Tammy Roberts Myers said in an e-mail.
Profit excluding the pretax impairment charge and severance costs was 68 cents a share, the company said. Fourteen analysts surveyed by Bloomberg estimated profit of 65 cents.
Full-year profit will be 60 cents to 85 cents, the company said. Fourteen analysts estimated profit of 88 cents, on average.
Limited’s 3,014 retail locations include Bath & Body Works and Henri Bendel as well as Victoria’s Secret.
To contact the reporter on this story: Allison Abell Schwartz in New York at aabell@bloomberg.net.
Last Updated: February 26, 2009 11:55 EST
Saturday, February 21, 2009
UW-L cutting $5 million, job losses possible
http://www.lacrossetribune.com/articles/2009/02/19/news/01uwl.txt
www.jobberz.com
The University of Wisconsin-La Crosse will likely cut $5 million from its budget in the next two years.
UW-L’s administration had been planning for cuts anywhere from $2 million to $6 million.
UW-La Crosse senior Nicole Holden takes notes during her Program Planning in Recreation class Wednesday at Wimberly Hall. UW-la Crosse is expected to cut $5 million of their budget over the next two years but aims to preserve a quality classroom experience when doing so. PETER THOMSON photo
“It is like going to the doctor when you have a problem,” said UW-L Chancellor Joe Gow. “You hope it’s not as bad as it might be — our problem is: It is as bad as it might be.”
Gow said while he can’t rule out staffing cuts, he hopes enough savings can be found elsewhere.
Five million dollars is about 6 percent of UW-L’s $82 million general program revenue budget.
UW-L will have to deal with cuts, while trying to grow enrollment and continuing hiring through the Growth, Quality and Access plan.
“We want to protect the classroom experience for students,” said Gow. “We’ll need to take a careful look at all the other things we do.”
UW-L will evaluate vacant positions. If that doesn’t produce enough savings, the university could be forced to layoff workers, said Gow.
“Personally, that is the hardest part of this situation and the biggest challenge that anyone that is leading a university will face,” said Gow. “We are going to make every effort to get though this with minimal job loss.”
Since the UW System Regents have yet to set tuition levels for the next two years, UW-L isn’t sure how much will be offset by increased tuition. UW-L officials estimated the $5 million based on possible 5.5 percent tuition increases each year over the next two years.
The budget calculations also figure in money from the federal stimulus package.
“People had hoped the federal money would soften impact,” Gow. “But this recession is so severe that even with federal money we will still need to make cuts.”
UW-L will continue Growth, Quality and Access hiring with an emphasis on classroom teachers, said Gow.
“We’ve made a commitment to students. The tuition was increased to provide them more teachers, more sections of classes and smaller classes, and we have to live up to that commitment,” said Gow.
Other schools, for the most part, aren’t hiring so UW-L is attracting some amazing candidates, said Gow.
“That is the only silver lining in this whole thing,” he said.
Building plans at UW-L such as the stadium, academic building and residence halls are not funded though the state’s operating budget, and aren’t affected, Gow said.
Western Technical College has calculated a possible impact of $350,000 in cuts over the next two years, said Western President Lee Rasch.
The college will know more after details come from the system. It hopes any staffing cuts will be through attrition, he said.
“The challenge will be trying to increase capacity to serve more students, particularly dislocated workers,” said Rasch.
Although Viterbo University was not directly affected by the governor’s budget, President Rick Artman said he was grateful for the governor’s support through the three percent increase over the next two years in the Wisconsin Tuition Grant for need-based students attending private colleges in Wisconsin.
History
In the last three bienniums, UW-L has had budget cuts amounting to $9.5 million and a total loss of 70 faculty and staff positions.
2001-03 biennium: UW System had $55 million in cuts, meaning a loss of $2 million for UW-L.
2003-05 biennium: UW System had $100 million in cuts, meaning a loss of $4.2 million for UW-L.
2005-07 biennium: UW System had $90 million in cuts, meaning a loss of $3.3 million for UW-L.
www.jobberz.com
The University of Wisconsin-La Crosse will likely cut $5 million from its budget in the next two years.
UW-L’s administration had been planning for cuts anywhere from $2 million to $6 million.
UW-La Crosse senior Nicole Holden takes notes during her Program Planning in Recreation class Wednesday at Wimberly Hall. UW-la Crosse is expected to cut $5 million of their budget over the next two years but aims to preserve a quality classroom experience when doing so. PETER THOMSON photo
“It is like going to the doctor when you have a problem,” said UW-L Chancellor Joe Gow. “You hope it’s not as bad as it might be — our problem is: It is as bad as it might be.”
Gow said while he can’t rule out staffing cuts, he hopes enough savings can be found elsewhere.
Five million dollars is about 6 percent of UW-L’s $82 million general program revenue budget.
UW-L will have to deal with cuts, while trying to grow enrollment and continuing hiring through the Growth, Quality and Access plan.
“We want to protect the classroom experience for students,” said Gow. “We’ll need to take a careful look at all the other things we do.”
UW-L will evaluate vacant positions. If that doesn’t produce enough savings, the university could be forced to layoff workers, said Gow.
“Personally, that is the hardest part of this situation and the biggest challenge that anyone that is leading a university will face,” said Gow. “We are going to make every effort to get though this with minimal job loss.”
Since the UW System Regents have yet to set tuition levels for the next two years, UW-L isn’t sure how much will be offset by increased tuition. UW-L officials estimated the $5 million based on possible 5.5 percent tuition increases each year over the next two years.
The budget calculations also figure in money from the federal stimulus package.
“People had hoped the federal money would soften impact,” Gow. “But this recession is so severe that even with federal money we will still need to make cuts.”
UW-L will continue Growth, Quality and Access hiring with an emphasis on classroom teachers, said Gow.
“We’ve made a commitment to students. The tuition was increased to provide them more teachers, more sections of classes and smaller classes, and we have to live up to that commitment,” said Gow.
Other schools, for the most part, aren’t hiring so UW-L is attracting some amazing candidates, said Gow.
“That is the only silver lining in this whole thing,” he said.
Building plans at UW-L such as the stadium, academic building and residence halls are not funded though the state’s operating budget, and aren’t affected, Gow said.
Western Technical College has calculated a possible impact of $350,000 in cuts over the next two years, said Western President Lee Rasch.
The college will know more after details come from the system. It hopes any staffing cuts will be through attrition, he said.
“The challenge will be trying to increase capacity to serve more students, particularly dislocated workers,” said Rasch.
Although Viterbo University was not directly affected by the governor’s budget, President Rick Artman said he was grateful for the governor’s support through the three percent increase over the next two years in the Wisconsin Tuition Grant for need-based students attending private colleges in Wisconsin.
History
In the last three bienniums, UW-L has had budget cuts amounting to $9.5 million and a total loss of 70 faculty and staff positions.
2001-03 biennium: UW System had $55 million in cuts, meaning a loss of $2 million for UW-L.
2003-05 biennium: UW System had $100 million in cuts, meaning a loss of $4.2 million for UW-L.
2005-07 biennium: UW System had $90 million in cuts, meaning a loss of $3.3 million for UW-L.
www.jobberz.com
Automakers Seek $14 Billion More, Vowing Deep Cuts
DETROIT — The price tag for bailing out General Motors and Chrysler jumped by another $14 billion Tuesday, to $39 billion, with the two automakers saying they would need the additional aid from the federal government to remain solvent.
In return, the two companies also promised to make further drastic cuts to all parts of their operations, in the hope that they can eventually strike a balance between their bloated cost structures and a dismal market for new car sales.
G.M., for example, said it would cut 47,000 more of its 244,000 workers worldwide; close five more plants in North America, leaving it with 33; and cut its lineup of brands in half, to just four: Chevrolet, Cadillac, GMC and Buick.
The Pontiac brand will have a much smaller role, if any, in G.M.’s future, and the company also said it would phase out its Saturn brand, which it once hoped would build small cars to counter the best of the Japanese brands.
G.M. also said it had made progress in discussions with the United Automobile Workers union and its bondholders to reduce its costs further.
The cash crisis will require fast action by the administration’s new cabinet-level Presidential Task Force on Autos, which is overseeing the reorganization of G.M. and Chrysler.
The deteriorating finances of the two companies present the Obama administration with two options, neither of them appealing.
It can provide the money in the hopes that the companies will stabilize, and no longer have to keep pushing workers into a growing pool of people without jobs. But there are no guarantees, as the Treasury Department learned on Tuesday when the automakers filed updates on their restructuring plans, that they might not be forced to come back again with requests for more money.
But if the federal government balks at the automakers’ requests, that would mean the two companies probably would have no choice but to file for bankruptcy protection, because they are losing hundreds of millions of dollars each month.
And the car companies said on Tuesday that the cost of a bankruptcy reorganization, with the government providing financing to help it through that process, would be far greater than their latest loan requests. Without such help, the companies would have to liquidate, creating staggering new job losses.
In a statement, the administration said Tuesday night that its task force would be reviewing the carmakers’ reports in coming days, adding that “more will be required from everyone involved — creditors, suppliers, dealers, labor and auto executives themselves — to ensure the viability of these companies going forward.”
The third Detroit auto company, Ford Motor, has not received federal assistance and has no requests pending.
By March 31, the presidential task force is expected to rule on whether G.M. and Chrysler have restructured enough to be viable businesses for the long term.
Big questions remain, including whether G.M. and Chrysler, as well as Ford, will be able to cut their unionized labor costs to parity with foreign automakers, as was required in the original loan agreement from last December.
The companies have been in marathon negotiations with the United Automobile Workers on reducing costs, as well as determining how they will finance health care trusts for retired blue-collar workers and their surviving spouses.
G.M. is also pushing for a deal with its bondholders to help it reduce its debt to $9 billion, from $27 billion. The U.A.W. said on Tuesday it had reached “understandings” with the Detroit companies on modifications to their contracts. Ron Gettelfinger, the union’s president, said “discussions are continuing” regarding how to fund the health care trusts at each of the companies.
Rick Wagoner, G.M.’s chief executive, said there had been “good progress” in talks with both the union and bondholders.
On the concessions in the U.A.W. contract, he said, “the things that have been negotiated really take a big bite out of what needed to accomplish.”
G.M.’s restructuring plan extends to its global operations. It will cut 47,000 jobs worldwide by the end of this year. It also said it would close 14 plants in North America by 2012 — five more than were included in its Dec. 2 loan request.
Mr. Wagoner said on Tuesday that the revamping plan was “comprehensive, responsive and achievable,” and could help the company break even by 2010. Both G.M. and Chrysler said they expected to begin paying back their federal loans by 20
Automakers Seek $14 Billion More, Vowing Deep Cuts
DETROIT — The price tag for bailing out General Motors and Chrysler jumped by another $14 billion Tuesday, to $39 billion, with the two automakers saying they would need the additional aid from the federal government to remain solvent.
In return, the two companies also promised to make further drastic cuts to all parts of their operations, in the hope that they can eventually strike a balance between their bloated cost structures and a dismal market for new car sales.
G.M., for example, said it would cut 47,000 more of its 244,000 workers worldwide; close five more plants in North America, leaving it with 33; and cut its lineup of brands in half, to just four: Chevrolet, Cadillac, GMC and Buick.
The Pontiac brand will have a much smaller role, if any, in G.M.’s future, and the company also said it would phase out its Saturn brand, which it once hoped would build small cars to counter the best of the Japanese brands.
G.M. also said it had made progress in discussions with the United Automobile Workers union and its bondholders to reduce its costs further.
The cash crisis will require fast action by the administration’s new cabinet-level Presidential Task Force on Autos, which is overseeing the reorganization of G.M. and Chrysler.
The deteriorating finances of the two companies present the Obama administration with two options, neither of them appealing.
It can provide the money in the hopes that the companies will stabilize, and no longer have to keep pushing workers into a growing pool of people without jobs. But there are no guarantees, as the Treasury Department learned on Tuesday when the automakers filed updates on their restructuring plans, that they might not be forced to come back again with requests for more money.
But if the federal government balks at the automakers’ requests, that would mean the two companies probably would have no choice but to file for bankruptcy protection, because they are losing hundreds of millions of dollars each month.
And the car companies said on Tuesday that the cost of a bankruptcy reorganization, with the government providing financing to help it through that process, would be far greater than their latest loan requests. Without such help, the companies would have to liquidate, creating staggering new job losses.
In a statement, the administration said Tuesday night that its task force would be reviewing the carmakers’ reports in coming days, adding that “more will be required from everyone involved — creditors, suppliers, dealers, labor and auto executives themselves — to ensure the viability of these companies going forward.”
The third Detroit auto company, Ford Motor, has not received federal assistance and has no requests pending.
By March 31, the presidential task force is expected to rule on whether G.M. and Chrysler have restructured enough to be viable businesses for the long term.
Big questions remain, including whether G.M. and Chrysler, as well as Ford, will be able to cut their unionized labor costs to parity with foreign automakers, as was required in the original loan agreement from last December.
The companies have been in marathon negotiations with the United Automobile Workers on reducing costs, as well as determining how they will finance health care trusts for retired blue-collar workers and their surviving spouses.
G.M. is also pushing for a deal with its bondholders to help it reduce its debt to $9 billion, from $27 billion. The U.A.W. said on Tuesday it had reached “understandings” with the Detroit companies on modifications to their contracts. Ron Gettelfinger, the union’s president, said “discussions are continuing” regarding how to fund the health care trusts at each of the companies.
Rick Wagoner, G.M.’s chief executive, said there had been “good progress” in talks with both the union and bondholders.
On the concessions in the U.A.W. contract, he said, “the things that have been negotiated really take a big bite out of what needed to accomplish.”
G.M.’s restructuring plan extends to its global operations. It will cut 47,000 jobs worldwide by the end of this year. It also said it would close 14 plants in North America by 2012 — five more than were included in its Dec. 2 loan request.
Mr. Wagoner said on Tuesday that the revamping plan was “comprehensive, responsive and achievable,” and could help the company break even by 2010. Both G.M. and Chrysler said they expected to begin paying back their federal loans by 20
Borders lays off 136 more Latest job cuts follow 2 years of losses topping $150 million
www.jobberz.com
Borders lays off 136 more Latest job cuts follow 2 years of losses topping $150 million
The Ann Arbor News
Beleaguered Borders Group Inc. marked another painful milestone in its quest to downsize and cut costs Thursday when it laid off 136 people, including 94 in Ann Arbor.
The changes mean total employment has dwindled at the bookseller's Ann Arbor headquarters on Varsity Drive from 1,300 several years ago to 770 today.
The latest job cuts follow two months of upheaval in the corporate ranks at Borders, which has been struggling to restructure and return to profitability after two straight years of losses topping $150 million. Financial results for 2008 will be released at the end of March.
In January, former chief executive George Jones was ousted and replaced with private equity executive Ron Marshall. A few other executives also were replaced.
Earlier this month, the jobs of six vice presidents and 10 department directors were eliminated. Several people were promoted from within to take over those duties.
Last summer, Borders - the nation's second largest bricks-and-mortar bookseller behind rival Barnes & Noble - laid off 275 employees, including 156 locally, as part of a previously announced plan to trim $120 million in expenses.
"While reducing payroll is never easy and we respect the impact it has on employees and their families, it is one of the necessary steps we must take along with other non-payroll expense reductions to help get this company back on track financially,'' Marshall said in a written statement.
Thursday's job cuts represent 12 percent of Borders' corporate employment base and affected departments ranging from marketing to human resources to sales. Workers whose jobs were eliminated are being offered transition pay, severance and job placement assistance, the company said in a statement.
"It seems like they are trying to avoid bankruptcy and trying to avoid taking the company private,'' said Ken Ahern, an assistant business professor at the University of Michigan's Stephen M. Ross School of Business. "It's not unusual to do all these kinds of changes if things aren't going well.''
On Thursday, Borders' stock (NYSE:BGP) closed up 3 cents to 54 cents a share.
Contact Stefanie Murray at smurray@annarbornews.com or 734-994-6932.
Borders lays off 136 more Latest job cuts follow 2 years of losses topping $150 million
The Ann Arbor News
Beleaguered Borders Group Inc. marked another painful milestone in its quest to downsize and cut costs Thursday when it laid off 136 people, including 94 in Ann Arbor.
The changes mean total employment has dwindled at the bookseller's Ann Arbor headquarters on Varsity Drive from 1,300 several years ago to 770 today.
The latest job cuts follow two months of upheaval in the corporate ranks at Borders, which has been struggling to restructure and return to profitability after two straight years of losses topping $150 million. Financial results for 2008 will be released at the end of March.
In January, former chief executive George Jones was ousted and replaced with private equity executive Ron Marshall. A few other executives also were replaced.
Earlier this month, the jobs of six vice presidents and 10 department directors were eliminated. Several people were promoted from within to take over those duties.
Last summer, Borders - the nation's second largest bricks-and-mortar bookseller behind rival Barnes & Noble - laid off 275 employees, including 156 locally, as part of a previously announced plan to trim $120 million in expenses.
"While reducing payroll is never easy and we respect the impact it has on employees and their families, it is one of the necessary steps we must take along with other non-payroll expense reductions to help get this company back on track financially,'' Marshall said in a written statement.
Thursday's job cuts represent 12 percent of Borders' corporate employment base and affected departments ranging from marketing to human resources to sales. Workers whose jobs were eliminated are being offered transition pay, severance and job placement assistance, the company said in a statement.
"It seems like they are trying to avoid bankruptcy and trying to avoid taking the company private,'' said Ken Ahern, an assistant business professor at the University of Michigan's Stephen M. Ross School of Business. "It's not unusual to do all these kinds of changes if things aren't going well.''
On Thursday, Borders' stock (NYSE:BGP) closed up 3 cents to 54 cents a share.
Contact Stefanie Murray at smurray@annarbornews.com or 734-994-6932.
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