UPS to cut 1,800 jobs by April

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UPS disclosed on January 8 that it will cut about 1,800 management and administrative positions in an effort to streamline its US management structure. The shipper also announced that it will reduce the number of districts and regions in its domestic small package operation.

In April, the company will reduce the number of its US regions from five to three, and districts from 46 to 20. The shipper said it will also strengthen local sales and marketing efforts. However, that announcement did not refer to any specific planned campaigns or initiatives, said Lisa Hamilton, leader of the UPS corporate PR group.

The company also disclosed that “attrition will minimize some job displacements” and 1,100 employees will be offered a voluntary separation package. The job cuts will affect non-operational employees of the US small package business who work in regional or district headquarters, said Hamilton.

Operational employees, such as delivery personnel and package-sorters, will not be affected by the streamlining, she said, adding that the job cuts will be complete by the end of UPS' fiscal first quarter, or March 31.

UPS has no plans to close operating facilities, the company said in a statement.

The shipping company disclosed the plans as it announced that fourth-quarter earnings will be better than expected in both domestic and international operations.

“However, we still anticipate a gradual economic recovery with improvement more evident as 2010 progresses,” Kurt Kuehn, company CFO, said in a statement.

The company will release its full earnings for the fourth quarter of 2009 on February 2.

In October, UPS reported revenues of $11.2 billion for 2009's third quarter, a year-over-year decline of 14.9% from 2008's $13.1 billion. In last year's second quarter, the shipper reported that earnings fell 49%. Its 2009 Q1 earnings were $10.9 billion, 13.7% less than the same quarter of 2008.

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