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Jan 31 2024

UPS to cut 12,000 jobs amid economic slowdown and plummeting delivery demand

United Parcel Service (UPS) has announced plans to cut 12,000 jobs in an effort to save more than $1 billion (£790 million) following a significant drop in delivery demand since the peak of the Covid-19 pandemic.

 

UPS fell short of Wall Street’s expected revenue target of $95.5bn (£74bn). The company reported a decrease in shipping volume, both internationally and domestically, in its fourth-quarter 2023 earnings report.

Consolidated revenues were $24.9bn (£19.5bn), marking a 7.8% decrease from the fourth quarter of 2022, according to the earnings report. Consolidated operating profit was $2.5bn (£2bn), down 22.5% compared to the fourth quarter of 2022 and down 27.1% on an adjusted basis.

 

Reports indicate that UPS shares also plummeted nearly 9% amid the economic slowdown.

 

UPS’ current workforce allegedly decreased by about 45,000 employees from 2021, and rival FedEx has also been reducing its workforce. President and CEO of FedEx, Raj Subramaniam, during an earnings call in June stated FedEx’s US headcount declined by about 29,000 in the fiscal year of 2023.

 

UPS executives stated that most of the job cuts would come from the ranks of its 85,000-management staff, as well as some contractors. These positions will not be reinstated even as the business recovers, the executives emphasised. Read more

 

Source: LOGISTICS MANAGER