Dive Brief:
- Job cuts recently announced by Waste Management at its Houston, TX headquarters will mostly involve reducing staff at the corporate level. The cuts are part of an overall corporate restructuring plan, according to Waste Management spokesperson Toni Beck.
- Al Kaschalk, a Wedbush Securities senior vice president, used past reductions to estimate the number of job cuts. He calculated the company could lose around 700 to 800 of the 7,500 employees currently on staff at the Houston location and projected a potential $100 million in savings.
- An adjunct professor from Jones School of Business at Rice University weighed in, saying that Waste Management could be caving into pressure from competitors to “slim down.” He also suggests the move could be a way to consolidate staff following acquisitions.
Dive Insight:
This isn’t the first time Waste Management implemented a restructuring plan in recent years. In 2012, the firm laid off 700 employees and hired CFO Jim Fish in order to improve efficiency. The result? $133 million in savings. The corporate changes that followed confronted issues like inflated service and general and administrative costs.
After the newest round of cuts were announced, some analysts suggested that the staff reduction is a way to make the company more attractive to shareholders. In July, Waste Management released second quarter results; revenues stood at $3.56 billion, an increase from the $3.52 billion over the same time period in 2013.