UPS will cut 12,000 jobs, due to weak demand and high union labor costs

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UPS announced it will cut 12,000 jobs, about 2.4% of its global workforce of more than 500,000 employees.

The logistics giant said on its earnings call Tuesday that in the fourth quarter it is seeking to cut costs by $1 billion, citing weak demand and high union labor costs.

“2023 has been a unique and difficult year,” Carol Toomey, the company’s CEO, said in a statement. “Through it all, we have remained focused on controlling what we can control, maintaining our strategy and strengthening our foundation for future growth.”

A UPS spokesperson confirmed that the job cuts represent less than 3% of the company’s workforce and do not affect the roles represented by unions. The spokesman said that jobs around the world and in all functions will be affected by the company, and that 75% of the cuts will come in the first half of the year.

The company reported revenues for the fourth quarter of 2023 of $24.92 billion versus $25.43 billion expected by Wall Street analysts.

UPS shares fell more than 8% in Tuesday trading.

In July, UPS agreed to a $30 billion contract with the Teamsters union This raised the average wage for a full-time worker to $49 per hour and $21 per hour for a part-time worker.

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