Given Citigroup's stated plans, a massive headcount reduction announced is sure to include a fair share of IT jobs.
The financial giant said on Monday it was planning to reduce headcount by a staggering 52,000 employees over the next few months -- the largest reduction by a company since IBM's layoffs of 60,000 employees back in 1993, and the 50,000 cuts by Sears that same year, says executive outplacement firm Challenger, Gray & Christmas.
Citigroup's latest round comes on top of the 17,000 cuts that the company has already made in the first three fiscal quarters of this year.
The goal now is to pare down the workforce from its current level of 352,000 to about 300,000 employees worldwide, Citgroup CEO Vikram Pandit said in an investor presentation (PDF) posted on the company's Web site today.
That target number is nearly 75,000 lower than the workforce of 375,000 employees at Citigroup as recently as the fourth quarter of 2007.
About half of the reduction will come from Citigroup's divesture of non-strategic businesses, and the rest will come from layoffs that either already have been announced or are being planned, Citigroup said. "We entered 2008 with more people, more businesses and more assets than fit our strategy," Pandit said in the presentation. "We expect near-term headcount to be down 20 percent in order to run the company in the right way."
The move is part of a wide ranging effort to improve operational efficiencies and slash expenses at the financially troubled financial giant, reducing Citigroup's operating expenses from the nearly US$62 billion it spent over the last year to between US$50 billion and $52 billion. "There is nothing easy about these decisions and the impact on our people. We do this because we must and not because we want to," Pandit said.
No details have been released yet on where the job cuts will come from, or what job functions might be most affected. But TowerGroup analyst Guillermo Kopp said to expect a fair share of them to involve IT functions.
Citigroup has previously disclosed its plans to derive some major cost reductions from its multi-billion dollar 25,000 person IT organization. Last year, before Pandit became CEO, Citigroup announced that it would be overhauling its IT functions via a series of data center consolidations, better use of existing technologies, optimization of global voice and data networks, standardization of its application development processes, and vendor consolidation.