Fire in job Market : ArcelorMittal going to cut 9000 jobs
ArcelorMittal, the world's largest steelmaker, said it may cut as many as 9,000 jobs, or 3 percent of its global workforce, after reducing output as demand slumped.
The job cuts, in sales and administration, are part of the company's bid to reduce spending by $1 billion, Luxembourg-based ArcelorMittal said today in an e-mailed statement.
``This could be the start of a wave of cuts in the industry,'' Charlie Dove-Edwin, an analyst at MF Global Securities Ltd. based in London, said today by phone. ``What's interesting here is that no job cuts are coming from production, which implies that the company is optimistic of a turnaround.''
The steelmaker, founded by Chief Executive Officer Lakshmi Mittal, 58, said Nov. 5 it was cutting output by more than 30 percent as a worldwide economic slowdown erodes consumption by builders and carmakers. Steel demand will decline next year, according to forecasts by Citigroup Inc. analyst Johan Rode and Peter Marcus, managing partner at World Steel Dynamics.
The company closed up 1.075 euros, or 5.7 percent, at 19.87 euros in Amsterdam trading. ArcelorMittal has slumped 63 percent this year, cutting the company's market value to 28.8 billion euros ($37 billion).
ArcelorMittal's output of flat carbon steel will fall more than 35 percent in the U.S. into early 2009 and 30 percent in Europe, its biggest markets. The company forecast earnings will drop as much as 48 percent to $2.5 billion in the fourth quarter.