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Citigroup CEO Vikram Pandit this week stunned an auditorium full of employees—not to mention the global financial community—with the news that Citi will eliminate 52,000 jobs from its
payroll of 352,000, said James Politi in the Financial Times. Not all the cuts are from direct layoffs—about half the reductions could come from the eventual sale of some Citi operations.
But the bank’s securities-trading and mortgage-packaging ranks in New York and London will be drastically thinned. And the psychological effects of one of the biggest job cuts in U.S.
history could be devastating. The layoffs “reinforce fears that the worst of the hit to employment from Wall Street’s struggles still has to make its way through the U.S. economy.”
The next wave of pink slips could be just weeks away, said Todd Wallack in The Boston Globe. In past recessions, monthly layoffs have spiked in December, as “executives typically scramble to
hit profit targets and prepare budgets for the following year.” The mutual-fund industry, for instance, has already been rocked by layoffs at Fidelity and Putnam, and other fund companies
will probably trim payrolls next month. “It belies the idea,” said employment consultant John Challenger, “that there is a taboo about firing workers between Thanksgiving and Christmas.”
The pain isn’t confined to financial firms, said Sudeep Reddy in The Wall Street Journal. From construction contractors and steelmakers to retailers and carmakers, layoff announcements have
been coming thick and fast, “buttressing economists’ warnings that the current downturn will rival the worst recessions since the end of World War II.” Private employers aren’t the only ones
to shrink payrolls. Facing plummeting tax receipts, state and local governments nationwide are slashing budgets and laying off workers. This week, Donita Mapp lost her $10-an-hour job
helping Detroit public-school students with disabilities. “I try not to worry,” she says, “but in reality you know you’re going to worry.”
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