Unilever Announces Plan to Cut 7,500 Jobs Globally
Unilever, the multinational consumer goods company renowned for brands such as Marmite and Domestos, has disclosed its intention to reduce its workforce by 7,500 employees worldwide. This decision forms part of the firm’s strategy to adapt to technological advancements, primarily affecting office roles.
The UK-headquartered company, with approximately 128,000 employees globally, anticipates that the majority of the job cuts will occur in office positions. Despite having 6,000 employees in the UK, Unilever confirmed that the country would not be exempt from the three-year productivity initiative.
Unilever plans to initiate consultations with affected employees following the identification of roles slated for elimination. Additionally, the company revealed plans to spin off its ice cream business, encompassing well-known brands like Ben & Jerry’s, Magnum, and Cornetto, by the following year, with a view to optimizing returns for shareholders.
In an effort to streamline operations and enhance focus, Unilever aims for mid-single digit underlying sales growth and modest margin improvement post-demerger. The company’s productivity program is expected to yield approximately €800 million (£984 million) in cost savings over the next three years, with restructuring costs estimated to be around 1.2% of its turnover during the same period.
Hein Schumacher, Unilever’s CEO, emphasized the company’s commitment to executing the productivity program with care and respect for affected employees. This strategic shift marks a significant move under Schumacher’s leadership since assuming the role last year.
Unilever’s decision to streamline its portfolio and prioritize scalable brands aligns with its vision to strengthen its position as a leading consumer goods company, fostering sustainable growth and profitability. The market responded positively to the announcement, with shares rising by nearly 5% at the opening.
Matt Britzman, equity analyst at Hargreaves Lansdown, commended the decisive action taken by Unilever’s new leadership, highlighting the market’s favorable reception to the news. The move reflects shareholders’ desire for proactive measures to drive performance and adapt to evolving market dynamics.
