Motorola Execs Targeted for Layoffs

In line with previously announced job cuts, Motorola, Inc. this week told its employees that it will lay off 20 percent of its nearly 600 top executives.

Since August 2000, the Schaumburg, Ill. maker of wireless communication devices has laid off 42,000 employees, reducing its workforce from a high of 150,000. Motorolas most recent round of 9,400 job cuts was announced on December 18.

“This is globally dispersed across all business, including the corporate staff, and across all functions,” said Margot Brown, senior director for corporate communications at Motorola, about the executive layoffs.

“Chris Galvin [Motorolas chairman and CEO] recognized that a company cant reduce its workforce by roughly a third, and continue to support the number of officers that it has,” said Brown. “Its not fair, its not equitable, and it doesnt make good business sense if you want to be responsive and efficient.”

Brown said the reduction of management is “roughly proportional” to layoffs at other levels.

The layoffs could begin as early as next week, and will greatly reduce the number of executives with titles of vice president or better at Motorola.

In its December 18th earnings announcement, Motorola said its newest round of job cuts could save the company about $865 million in 2002 and $1.1 billion on an annual basis thereafter. As a result the company expects to return to profitability in 2002.

The laid off executives will receive a severance package and various other amenities in line with industry practices, said Brown.