General Electric Company has announced it will cut 12,000 jobs in its power division, blaming falling demand for coal and other fossil fuels. Although the cuts are worldwide, the news hits close to home.
Boston-based GE said Thursday that the cuts, representing 18 percent of all jobs at GE Power, will take place largely outside of the U.S. Schenectady City Councilman Vince Riggi says whenever GE lays workers off, it’s a cause for concern for citizens of the Electric City. "It certainly isn't good news, that's for sure. And nationwide, worldwide, I don't think it's good news that an organization like the General Electric Company is cutting 12,000 jobs. That's an enormous amount of jobs and jobs lost, so it's not a good sign. I'm old enough to remember when they employed upwards of 30,000 people here. So it's a problem, and anybody that loses their job, especially now we come to this times of year, not that there's any good time, it's a problem. And now that we're down to 3 or 4,000 people, I'm not even sure what the exact number is, any jobs that are lost, it's gonna impact Schenectady."
The company says layoffs will help trim costs by $1 billion at GE Power in 2018, and that the plans announced today are driven by challenges in the power market worldwide.
Rob Macherone, business agent for Local 301, could not be reached for comment. He told the Times Union that about 75 non-union positions had been eliminated in Schenectady.
Last month, GE announced that it was slashing its dividend in half and that the conglomerate would narrow its focus to three sectors: aviation, health care and energy. The company has said it will shed assets worth more than $20 billion in the next couple of years.
Capital Region Democratic Congressman Paul Tonko recently addressed expected cuts on the Congressional Corner with WAMC's Alan Chartock. "A number of groups have been looking at certain profit margins and looking at the future what for GE is and what the role is with their power division, which is very important to our area, and as they may restructure that is very, very concerning to have new leadership. You know I know that while we may be downsized from what GE was in the past, it’s still a significant number of jobs, important jobs, jobs that attach a great salary to that effort and that work. And so however we can message and work to make those jobs, to be able to hold onto those jobs is very important and we'll continue to do that."
A spokesperson for GE Power in Schenectady responded to a request for comment by email, saying "we won’t have anyone available today for an interview." Russell Stokes, the Atlanta-based President and CEO of GE Power, tells investorplace.com that the “layoffs are painful, but that they will prepare GE Power for 2019 and beyond.”