3M announces mass layoffs as manufacturing slows

New York (CNN) 3M announced major layoffs on Tuesday as part of another major restructuring plan as the manufacturing sector prepares for a potential recession and waning demand for goods.

The manufacturing giant behind some consumer brands, including Post-It Notes and Scotch Tape, has said it will lay off 6,000 employees worldwide. These cuts are in addition to 2,500 3M manufacturing roles He was eliminated in January. 3M also announced several mass layoffs in 2019 and 2020, but the total number of employees has gone up and down over the past several years.

The company said it expects it will save up to $900 million annually before taxes after the layoffs end. 3M argued that the cuts were “intended to make 3M stronger, leaner, and more focused” by streamlining the supply chain and reducing levels of management.

“These actions are expected to significantly reduce costs and drive long-term improvement in margins and cash flows while enabling a more efficient and effective structure to drive long-term growth,” 3M said in a press release. statement.

3M also announced several management changes as it reported lower profits and sales than the previous year. Sales fell 9% to $8 billion, while net income attributable to the company fell 25% to less than $1 billion in the quarter.

The company said it will prioritize products that customers increasingly demand, including climate technology, sustainable packaging and automated industrial products, among other emerging technologies. 3M also reaffirmed its previous forecast for 2023, forecasting sales to decline by up to 6% this year.

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3M said supply chain problems that doomed the sector for years in the wake of the pandemic have largely eased. This means that the backlog of orders has shipped, and the company (and its peers) have not Longer need the same amount of staff to handle the workload.

Meanwhile, demand for manufactured goods has fallen in recent months. Consumers have been spending less on things and more on experiences lately, and companies are preparing for an expected recession.

3M competitor Dow also announced thousands of layoffs at the start of the year.

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