Philips Healthcare to cut 5% of work force

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Philips tries to improve healthcare margins with more layoffs. Image Source:  

Philips Healthcare based in Andover, Mass., said it is cutting 5 percent of its work force this week, or 1,600 jobs worldwide, including approximately 100 at its headquarters.

Spokesman Ian Race said the cuts were needed to streamline management and make the company more responsive to customers. He said the affected workers will be offered severance packages, according to the Boston Globe.

With its third-quarter results released in October, Philips said it would take measures to maintain profitability across all three business lines and the restructuring at the healthcare unit are the first specific steps to have been revealed. The company said it aims to improve its healthcare margins and streamline operations, particularly in its imaging systems business.

Royal Philips Electronics has about 4,300 workers in Massachusetts, with nearly 3,000 in the healthcare unit. Philips Healthcare has approximately 35,000 workers globally.