It’s Always A Good Time to Fire Some Folks

Illustration for article titled It's Always A Good Time to Fire Some Folks
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You ever notice how it’s always a good time to fire some folks? In the middle of a recession? Fire some folks. Coming out of a recession? Fire some folks. Enjoying a prolonged uptick in economic performance? Fire some folks. Predicting another recession on the horizon? Oh, you better believe it’s time to fire some folks.

Indeed, it is that time again at Ford Motor Company, as the Detroit Free Press and many others have announced, the time to fire some folks:

The company’s cuts will total 7,000 workers by the end of August, including voluntary buyouts and involuntary layoffs and reductions that have already occurred.

The cuts include 500 salaried workers in the U.S. who will leave involuntarily this week and 800 in the U.S. by August.

The move comes as Ford is under pressure from investors to reduce costs and improve its profitability, with a particular emphasis on bloated overseas operations.

The move is expected to save $600 million, Automotive News reports, and continues cuts that began last year.

To be clear, these layoffs will not come from hourly factory workers, but white collar staff across the globe. CNBC reports 2,300 of those cuts will be in the U.S., with the rest in overseas markets, particularly Europe, as part of a major global restructuring.

Ford, like every major automaker, is dealing with reduced profits due to slowing sales. Especially in foreign markets, Ford has some work to do. There no denying that Ford, like every other car company, could do with reducing costs, and a very easy way to reduce costs is to fire some folks.


But “pressure from investors to reduce costs and improve profitability” is not an observation about a unique set of circumstances leading to extraordinary actions such as laying off 7,000 workers. It is simply what investors do. They demand reduced costs and improved profitability. That’s their whole deal.

The fact that this is part of a massive restructuring, as a subset of a larger effort to shore up against the oncoming recession, means this firing of folks is presumably to prevent a larger firing of more folks in the future. But don’t be surprised if they still have to fire some folks, maybe a lesser number of folks, in the future. It is, after all, always a good time to fire some folks.

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