American Skandia has made broad-based cuts affecting all areas of its business, including an anticipated reduction to its wholesaling staff. Several weeks ago, the Shelton, Conn-based firm laid off 11 wholesalers, and last week it instituted a series of staff cuts throughout the organization amounting to approximately 12% of its employees.
Tim Klahs, director of investor relations, declined to give firm numbers, but confirmed that since the first round of layoffs were announced last spring, about 120 jobs have been cut out of approximately 1,000. The layoffs have taken place across the firm, with the exception of personnel working in the firms new customer service facility in Denver.
American Skandia had anticipated annual savings of $38 million from this springs cut of 150 people and Klahs said that this round would result in savings amounting to a little less than $30 million.
Klahs, who declined to comment on the possibility of additional cuts, did say that the decision was not related to budget concerns. "This was something that weve been monitoring since we did the first round and it wasnt something motivated by a need to address a situation that we werent aware of," he said.
While many employees have lost their jobs the firm is still looking to fill the position of VP of marketing for wrap products, which has been open since early this year.
"You look at things from the outside and you say theyre getting rid of X number of people, but there are always an ebb and flow, people who are coming and going," Klahs said.
As for the internal reaction to the news among Skandia employees, Klahs said, "I think it would only be the naïve that they would be alarmed or upset by the fact that were also taking on new people in certain respects while these changes occur."
Klahs said that many stockholders view the news as a positive, demonstrating the firms ability to anticipate market conditions and make decisions with future business in mind. He noted that some firms have been caught off guard and ended up cutting staff as a knee-jerk reaction, rather than the measured tiered layoffs instituted by his firm.