Amex to Cut 7,000 Jobs
Further evidence of the economic contraction: American Express -- the largest U.S. credit card company by purchases -- said today it will cut 7,000 jobs and take up to a $290 million charge related to the cuts in a move designed to save $1.8 billion next year.
Earlier this year, Amex announced a "re-engineering" plan designed to cut costs as consumers cut back on their credit-fueled spending. The job cuts represent 10 percent of the company's global workforce.
The company also has frozen hiring and will cut back on marketing, it said in a statement.
“The re-engineering program we announced today will help us to manage through one of the most challenging economic environments we've seen in many decades," Amex chairman Kenneth I. Chenault said in the statement.
Wall Street liked the cuts, as it usually does: Shares of Amex are trading up 2.5 percent so far today. That's a nice change from the stock's performance over the past year -- shares of Amex have lost more than half of their value since this time last year.
What might the cuts mean to Amex cardholders? Well, there's this cryptic statement in the release: Some of the anticipated savings will come from "streamlining costs associated with some rewards programs." Though Amex said the cuts would come from parts of the company that do not interact directly with customers.
-- Frank Ahrens
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