Siemens' CEO Peter Loescher announced Tuesday that the company plans to eliminate 16,750 jobs throughout the company, including 2,800 from its healthcare sector, as it seeks to boost profit margins to the level of its competitors.
According to Bloomberg, the company will cut 6,350 jobs from its industry unit and 3,950 from energy, the CEO said. Most jobs will be administrative positions—losing 800 positions at its headquarters.
Among the cuts, 5,250 will take place in Germany, representing about 3.9 percent of the total layoffs, according to Loescher. Bloomberg reported that another 4,150 further positions will be ‘affected’ by the company's reorganization, the CEO said.
“We want to begin negotiations with the employee representative quickly in order to make the cuts in a way that will be as socially responsible as possible,” Loescher said at the press conference today, reported Bloomberg.
Siemens generates less sales and profit per employee than peers including GE, which competes with Siemens in industries such as health care and power generation. The company earned about $12,710 per employee last year, compared with $67,914 for each worker at GE, according to data compiled by Bloomberg.
Siemens, whose products include light bulbs, medical scanners and trains, has lost 36 percent this year in Frankfurt trading, cutting the company's market value to $98.8 billion (€63.3 billion), Bloomberg said.
Loescher, who joined Siemens a year ago from Merck, has cut management layers and pooled nine operating units into three.