Banking giant Citigroup announces mass layoffs

On March 26, Chuck Prince, CEO of Citigroup, announced that the world’s largest bank will cut at least 15,000 workers. Prince also said that at least 14,000 additional positions will be lost to attrition or relocated from high-cost locations to less expensive areas. Roughly 8 percent of the bank’s 327,000 workers across the world will be greatly affected. Most of the cuts will be placed on back-office workers and high-paid workers in management. Citigroup, the world’s largest bank, argued that these job cuts are necessary for the benefit of the company’s maximization of profits. Citigroup posted at least $37 billion in profits in 2006. One of the benefits that Citigroup is reaping is increased access to cheaper labor in economically underdeveloped nations. In India, 12,000 workers toil for Citigroup each day. This means that in order to maximize profits, Citigroup has replaced the jobs of U.S. workers with cheaper labor in oppressed countries. Prince stated that his goal is to create a “leaner, thinner” Citigroup, which manly focuses on anti-worker measures for the benefit of the rich. According to Ivan Feinseth, an analyst of Martix USA, “He’s [Prince] trailing everyone, and he’s got to increase the return on capital–it’s the key to everything he’s doing.” One of Citigroup’s major shareholders, Saudi Prince Alwaleed bin Talal, has been recently pressuring the bank to perform the anti-worker measures. He declared, “We have to take draconian–and I say draconian–measures to control the costs.” (New York Post, March 27). But cost-cutting concerns don’t trump the dispensation of enormous executive salaries. Prince got a whopping 13 percent pay hike last year. He now makes $26 million per year, and the bank has maintained its profitability in the global banking market. Image source: pslweb.org

News selected by Covalence | Country: USA | Company: Citigroup | Source: Party for Socialism and Liberation