Economy, Lost Jobs Prompt Transcontinental Cuts
MONTREAL—With the U.S. economy impacting the communication and marketing investments by clients, Transcontinental has implemented rationalization measures that call for the elimination of about 1,500 jobs, or roughly 10 percent of its workforce. Major cost-cutting measures are being implemented at plants throughout the United States, Canada and Mexico.
As a result of customers dialing back on their spending, commercial printing jobs, direct mail projects and magazine advertising placements have been cancelled or postponed by companies impacted by the recession.
“It’s a difficult situation for everyone affected, but we are acting in the interests of all of our employees and our shareholders,” said François Olivier, president and CEO of Transcontinental. “In the short term, this rationalization comes at a cost but, in the medium term, it will protect the corporation’s financial health.”
Among the other measures Transcontinental has taken in its cost-cutting initiative: a hiring freeze, unpaid leave and reduced work weeks. Transcontinental’s senior managers have decided to take two weeks of unpaid leave, but to work throughout that period. These measures will cut costs by about C$75 million on an annualized basis, including C$50 million in 2009. Capital investments, except for those assigned to outsourced newspaper printing, have been reduced.