Boral announced this morning that it will shed another 700 Australian jobs before March:
The changes will see a reduction in employee numbers in Australia, resulting in benefits of approximately $90 million annually, with estimated savings of $37 million to be delivered in FY2013.
“The restructure I am announcing today will transform the Group into an organisation that is more responsive to the realities of a cyclical marketplace and one that remains competitive not just during the cycle highs but when conditions are challenging, as they have been for the past few years. Our more streamlined organisation will align with Boral’s operational footprint, which has become more focused through recent divestments, closures and capacity rationalisation activities.
“Regrettably, the changes will mean job losses at the executive level, in the corporate office, in divisional offices and in the businesses. Customer service will not be impacted by the restructure with the changes focusing on back office, managerial positions and support activities. We remain committed to our valuedriven strategy for customers through our sales and marketing excellence and innovation programs. We also remain focused on delivering leading practice safety performance and lean manufacturing.”
It’s not clear how many of the jobs will go in building materials and cement but that’s the lion’s share of the business and is where the executive restructure is transpiring. As we know, the RBA and Treasury hope that rate cuts will boost housing construction this year, absorbing the construction job losses that will come from the looming decline in mining investment. Basically they hope to turn this around:
Boral does not appear to believe it’s possible.
6a531cb4-5f5b-11e2-914c-b145809d54e3_Boral statement on new business structure.pdf by
The RBAs goal in cutting rates is to prevent deleveraging and it is having success on that front.
The RBA may hope that some of the continuing slow household debt growth will be directed into housing construction but that is not going to happen until the state govts fix the causes of over priced new land releases.
FHBs have woken up are not prepared to be the fall guys in the housing asset price maintenance racket.
Certainly does help that the NSW govt enjoys the fruits of the racket via Landcom.
Landcom should be used to drive down the price of new land not help prop it up.
Philip Soos in BS -
We’re in a ‘terminal ponzi phase’.
http://www.businessspectator.com.au/bs.nsf/Article/residential-property-house-prices-housing-mortgage-pd20130115-3Y4BY?OpenDocument&src=sph&src=rot
You bet your sweet ass.
and the sweet aroma of toasted property investor is just beginning to tinge the air…
Like a neighbours BBQ when you haven’t eaten for a while.
Fantastic isn’t it!
Thanks very much for that link Ortega.
““A troubling fact is that almost 60 per cent of investor loans are interest-only (25 per cent for owner-occupier loans), signifying the speculative motive of property owners.”
An understatement;
“When it does burst, heavily indebted property owners (recent home-buyers, negative gearers) will experience financial trouble, including the economy at large.”
….including the Banks.
I always marvel at how firing people can be spun as a positive thing. “Our company was so full of superfluous labour that removing unproductive layabouts will benefit everyone (except said unproductive layabouts)”
the fact that this decision to improve effectiveness and customer value comes at the same time as a major downturn in our sector is nothing but pure coincidence
The harsh truth is that businesses operate to return a profit and not essentially to provide employment. Sizing a business to the level of sales or activity is , while very hard on those effected, is also helping to ensure the jobs of those remaining.
A healthy economy should provide enough job opportunity, through other growing businesses, to soak up those looking for employment. Currently that is not happening and probably the source of a large part of why Consumer Confidence is in the tank.
too true… at the tender age of 18 I had the pleasure of being made redundant.. 6 months later it happened again.. just bad luck joining companies that were hitting the skids.
I made a decision then which basically was that I owed the company 38 hours of my time for which they pay me the agreed salary. If either party terminated the agreement so be it. I am sure there are lots of people who think that companies value their employees. I am not one of them
I think you have it about right. Fair work for fair pay is all that’s entitled to by either party.
Believing it is anything more or worse, making financial plans around that premise, can be hazardous. That’s why good workmates make such a difference.
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