by Hayley Glatter | December 7, 2017 9:32 am
General Electric’s Power division will cut roughly 12,000 jobs worldwide as it looks to reduce structural costs by $1 billion in 2018, the Boston-based company announced Thursday.
The decision lands in the midst of upheaval in the power industry, as it faces “softened” markets for traditional commodities like gas and coal, and heightened demand for renewables. According to a company press release, the layoffs come in response to these changing dynamics, as GE Power aims to remain profitable in the midst of the evolving landscape.
“This decision was painful but necessary for GE Power to respond to the disruption in the power market,” Russell Stokes, the president and CEO of GE Power, said in a press release. “At its core, GE Power is a strong business. … This plan will make us simpler and stronger so we can drive more value for our customers and investors.”
The layoffs aren’t exactly shocking, as pink slip speculation has haunted GE’s halls for months. In mid-November, the conglomerate announced it would let go of up to 25 percent of its corporate-level workforce, and CEO John Flannery said he aims to relinquish $20 billion of the company’s assets over the next two years.
GE Power is a behemoth in the energy sector, generating roughly one-third of the world’s electricity, according to the press release. The Schenectady, New York-based division is the company’s largest industrial business, previously employing over 55,000 employees and generating roughly $27 billion in revenue in 2016.
GE as a whole aims to cut costs by $3.5 billion in 2017 and 2018. The company plans to move into its new Seaport headquarters in 2021, a two year delay from the original plan of 2019.
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