FedEx delivers int'l profits but cuts US jobs

Like i've said before, unemployment and loss of jobs are no reliable indicators of the economy in this process improvement era. Corporations spend millions on Lean, Six Sigma, Theory of Constraints, etc to figure out how to become more efficient and reduce variation, which many times leads to task realignment and layoffs. If you've never participated in this process, the sad part is that you (future unemployed) contribute to the effort to map out and design better processes. The "show me the money" reductions DO come from upper management unimpressed by pretty pictures and feel good stories alone.

I just don't know how we can stop these CEOs from screwing the rest of us into the ground. At what point will it end?

How do we stop them? By not putting money in their pockets. Stop supporting corporations. Buy local, from small businesses that give back to the communities they are in.

At work we call it "six smegma". Before very long, the "low hanging fruit" was all gone, and now the fruit is emplyee pay and benefits.

Wow, you guys really don't know anything about Fred Smith or FedEx, do you? When the economic recession started, the entire company was forced to make cuts. He cut everyone's pay by 10% (across the board), and cut his pay to $1 per year (yes, one dollar). Many of the upper management voluntarily cut their pay dramatically as well, as a sign to the employees that everyone was feeling the struggles. When their business started picking back up, not only did he reinstate their wages, but gave them a raise. He still keeps his salary lowered, fyi.

Being a lifelong Memphian, I can say that FedEx is probably one of the best employers in the area, and they take GOOD care of their people. I've never worked there, but my next door neighbor has been there since high school, and he's now in his mid 30's and a manager.

Grew up in Memphis, have relatives that still work for fed ex, and all I know is, that whether or not Fred is a saint, they still doubled profits and yet cut jobs.

It is getting to the point where the company is telling the wage slaves that they have the money to give them a raise, but they won't give them anything. No company can function without their workforce, but they do not care about them at all. It is all about giving dividends to the investors or stockholders. FedEx just proved it. They are looking at having to pay less per share to stockholders. This means that 1,700 people have to be sacrificed so that their profits are higher and they can pay higher dividends. They have the money to keep them employed, but they won't do it.

The are making adjustments to weak portions of their business, which is smart business.

On another note, this doesn't show well for the economy, if they thought shipping was going to pick up, they would not be letting people go.

Why do so many people think that companies are there just to employ people, and not to make money?

Wow, that's great, Tri! (except, perhaps, for the 1.7K)

Hey gang, wanna make easy money? Come up with some smoke-and-mirrors scam, waltz into some outfit, and convince 'em that it's the greatest thing since zippers in trousers! Pump 'em up with platitudes about how you could tell when you walked in, that the place is obviously managed by a "well above the crowd" group of intellects. Once you get one place to bite, you can use the fact on everybody else: "Gosh, your competition is gonna leave you in their dust!"

All this no doubt prompts the question "Well, why aren't you taking the money yourself?" The answer is that I have long been among those who've actually done the work, and I won't stoop to screwing them for the sake of highly intellectual 'zecutives and stockholders.

Why do so many people think that companies are there just to employ people, and not to make money?

The thing is,companies need the employees to do the work, or they don't make the money. Also during this whole economy debacle they have learned that they can make their workforces smaller, work their employees longer and harder with lower pay and no benefits, and still make the same amount of money they were making before, leaving them well off, but their workers worse off. Sure that's great business, but I think it's damned cold hearted, as well as a slap in the face of the people that basically make your money for you.

If you really believe that I have a bridge in Arizona to sell you.

FedEx 1Q profit doubles; will cut 1,700 jobs
FedEx did raise its financial outlook for the full fiscal year after its first-quarter net income doubled. But the projections for the second quarter and full year fell shy of Wall Street expectations, and the stock dropped almost 3 percent in premarket trading.

For the full fiscal year that ends in May, the company now expects net income of $4.80 to $5.25 per share. That's up from its estimate of $4.60 to $5.20 per share in July but some analysts were forecasting earnings as high as $5.60 per share, according to Thomson Reuters.

The Memphis, Tenn., company earned $380 million, or $1.20 per share in the fiscal first-quarter that ended in August, compared with $181 million, or 58 cents per share a year ago. That's slightly under the $1.21 per share that Wall Street expected.

Revenue rose 18 percent to $9.46 billion.

FedEx shares fell 2.9 percent to $83.45 in premarket trading.

ryan, I hope that this helps you to see the big picture. The rest is the manipyulative excuse they want the public to buy.

It's all about profits.

Huskergal,

But the FedEx Freight segment lost money again as demand for large items like refrigerators and other appliances continues to be weak.

Cut where it is weak, and gain where it is strong.

It's seems like some of you have very little understanding of business, and only understand headlines.

It's all about profits.

And it should be. Please tell me the Union pension fund investing in FedEx is going to accept sub par gains. Sorry but they won't...

My dad's been with FedEx for nearly 30 years. His girlfriend has been with FedEx for nearly 25. Both are nearing retirement and my dad's job is being threatened. His girlfriend, however, is not so lucky, she got laid off last week with a pension plan that was not even close to what she would have been recieving after retirement. Uncle Freddy (that's what we called him growing up) put food on our tables and presents under our tree for nearly my entire life so I'm thankful for that. But I still don't agree with how they've recently started treating long term employees like my dad & his girlfriend.

Please tell me the Union pension fund investing in FedEx is going to accept sub par gains

You are talking International. I can not speak for them or for what they do, but they have little to do with the employees; they are paid advisors and negotiators. The local is important to the workers. It is the local that is the bargaining unit. The local only gets what it asks for from the employer and it usually is a compromise at that.

For the company, it is all about profits. Weak area, since when does FedEx deliver refrigerators? the trucks they are cutting are local "mail" trucks.

It's not just the executives. The investor play a huge role in this. It is more about the investor than the executives who are just salaried employees with great benefits.

Sugartree,

This idea that the company owes you something for working for them is foreign to me. Whether he worked there for 30 days or 30 years makes no difference. The company owes him a days pay for a days work.... nothing more and nothing less.

No I think a company owes its workers a bit more than that for giving a portion of their lives to generating a profit for them. Again, no workers, no effing money.

Workers should start realizing how powerful we really are and how screwed these fat cats would be if we all disappeared tomorrow. If we don't do it soon, we'll be back to a turn of the century wealth divide and slave wages.

huskergal, I'm not so sure you understand what I am talking about....this has nothing to do with locals, it has to do with large pension funds being the investors wanting better profits, and these large pension funds being Union pension funds.

since when does FedEx deliver refrigerators?

They do have a freight side to the business, it's not just a business that goes door to door.

Sugartree-

Thanks for illuminating was has been going on throughout this depression. That is companies having been pruning their older workers. Why? Because they make more money, after years of loyal service like your dad's, they cost benefits plans more because of medical insurance, and there's a gaggle of younger workers who walk in the door wanting the corner office, and are unafraid to squeal like a stuff pig until there get their way.

in total this spells big trouble for older workers who are too far from retirement to just stop working, Soc Sec ages are rising and their futures look very dim as other companies don't want to hire these "over qualified" workers.

I think these companies will rue the day they let these loyal, experienced workers go. They don't seem to have this entitlement meme going that younger workers do, and they just have more experience. Some smart guy is going to scoop these older workers up when they realize that they're a valuable asset.

UPS folks, UPS.

This isn't a local: the AFL-CIO REIT is where the principal pension funds of the entire national Union are invested.

He cut everyone's pay by 10% (across the board), and cut his pay to $1 per year (yes, one dollar). Many of the upper management voluntarily cut their pay dramatically as well, as a sign to the employees that everyone was feeling the struggles. When their business started picking back up, not only did he reinstate their wages, but gave them a raise. He still keeps his salary lowered, fyi.

Then explain this:

Frederick W. Smith
Annual Take Home $4,278,511
Base Salary $1,355,028
Options Gains $1,617,044
Other $1,306,439

Source

SU,

You're right, the workers did help the company to grow. And in return they earned a good wage and were able to live the life of their choosing.

I don't see how the company owes them anything more than that.

I think companies operating in this country need to look at their employees as those who have helped build their company with their sweat equity, and ideas.

Not only that, all workers, via paying their taxes, have contributed to building the infrastructure of this country that benefits companies greatly. Roads, bridges, airports, etc, etc all allow FedEx to do what it does. What thanks do the employees get? A pink slip. What do investrs get? A dividend, or a higher stock price. While the company continues to utilize the worker paid transportation infrastructure. Nice.

American companies are so shortsighted. This next Quarter mentality is hurting our country. These bare-bones lean and mean corporate structures may be all the rage, but wait until they realize there's not going to be anyone to utilize their products because they and their cronies, who are all on each others Boards, pruned so severely that what they've actually done is decimate their customers purchasing abilities. , This will continue to happen.In short, they're screwing themselves, and their employees. Everyone loses.

I'm afraid these jobs are gone for good.

Most workers are no longer making a good wage or living the life of their choosing, but more or less living the life they can eke out while the people at the top haven't felt a single pang. Not to mention if someone invests 30 years of their life into a company that company should do a little investing in the employee other than a simple (and often inadequate) wage.

If you are unhappy because your wages can no longer purchase all the things that you think you need, look to the fed Government not your employer. It is the Fed's monetary policies which create inflation and destroy the purchasing power of the dollar, not the company's.

Did the worker forgo a paycheck or 2 to help the company through hard times? Did he invest any of his own money to start the company? Then he has not 'invested' 30 years of his life to the company anymore than the company has invested 30 years into his life. He agreed to work for a certain wage, if he has received those wage payments throughout his 30 years, then the company owes him nothing more.

The company owes him a days pay for a days work.... nothing more and nothing less.

I agree with you on this statement, however, the employer should pay the employee a living wage. Do you favor a company that hasn't given their employees a raise in 9 years? Do you favor a company who cut new hire wage because someone asked for a raise? Do you favor a company that says it can afford to give raises, but just won't? There are companies out there that do just this. Management is proud of themselves and stuff their pockets full with profits-and their investor's pockets. The company owes their employees for the work they do at a liveable rate of pay; not at minimum wage or just slightly above.

Oldmustang-

If you are unhappy because your wages can no longer purchase all the things that you think you need, look to the fed Government not your employer. It is the Fed's monetary policies which create inflation and destroy the purchasing power of the dollar, not the company's.

Inflation? What inflation?? The only inflation of any significance I see is in health care sector. Republicans and a few Democrats (Max Baccus) fought tooth and nail to keep price controls out of the Health Care Reform bill. And now we have rising prices continuing.

Also, you do realize that companies have been asking for, and receiving, wage and benefit concessions don't you? That in this economy, employees cannot just pick up and move to another job like they could when Clinton was President? No, six years of Republican control saw to that.

While I can follow the ideological thread your drwing in your statement, you've also proven those ideological rigidity can cause you to drive of a cliff. If all companies only view their employees as widgets to discard on a whim, th at is not, in my opinion, bad for the company in the long run, it's bad for the economy that thecompany is trying to be successful in.

Just like businesses want to see a stable economic way froward, citizens need to have a resonable expectation that their economic viability will be at least, somewhat stable, for the foreseeable future before committing to a car or home loan. or starting their own business.

All this uncertainty stunts the economic growth of the country. These capricious employment policies are akin to the companies shooting themselves, and the nation, in their collective feet.

Stupid and short-sighted.

While I can follow the ideological thread your drwing in your statement, you've also proven those ideological rigidity can cause you to drive of a cliff. If all companies only view their employees as widgets to discard on a whim, th at is not, in my opinion, bad for the company in the long run, it's bad for the economy that thecompany is trying to be successful in.

Wow, lets try that pargraph again.

While I can follow the ideological thread your drawing in your statement, you've also proven that ideological rigidity can cause you to drive off a cliff. If all companies only view their employees as widgets to discard on a whim, that IS, in my opinion, bad for the company in the long run. It's also bad for the economy that the company is trying to be successful in.

My editor when out to lunch 8)

Jim and huskergal,

Jim, you lose credibility when you blame 6 years of Republican control for something that both parties are responsible for creating(especially since the R's only held the House for 6 years, the D's held the Senate for 3.5 years during the Bush Administration). Meaning nothing went through the Senate without substantial Dem support.

Other than that, the official CPI numbers being posted are bull@!$%#. If you can't see a substantial increase in the prices at you local grocery store, then please tell me where you live because I will be packing up and moving shortly.

Are you surprised that companies are cutting wages where ever possible. It is a loose labor market so they are in the drivers seat. In tight labor markets wages can increase just as fast, my income increased over 25% from 2004 through 2006. It was a tight labor market and I was in the drivers seat. It is no surprise to me that I have not seen an increase since 2007. Labor is a commodity that is affected by supply and demand just as any other commodity would be affected. The laws of supply and demand are not only in effect when they are of benefit to us.

Jim, you seem to be searching for some sort of job security promises and there are none. If you want job security, IMO you have 3 choices. Medical field, sanitation(garbageman), or police officer(if you can avoid being shot). If you are working any other job then you should not expect to work there for 20-30 years. If you are able to, that's great. If not, it should come as no surprise to you and you should have been preparing for that possibility all along.

Is it good for business, you're right, it probably is not long term. Companies changed the way they operate when globalisation allowed them to. They will continue to do business this way until the living standards in the US, China, and probably India too, are a lot closer to being equal.

Price controls and protectionism do not work. They never have and they never will.

First, I certainly don't expect any sort of guarantee or a life-long job. With what I've been through in my life I take nothing for granted, and am not too surprised when radical change occurs with out warning. You lose credibility as well, when you try to stuff someone you perceive to be liberal into that tired old conservative meme about "liberals".

Second, the CPI already includes food as one of it's components. So the price increases you mention are in the CPI number. Besides, those increases are the result of some genius thinking it is a good idea to use farmland. and food commodities for fuel, rather than the price increases being of a structural money supply nature.

What I'm really trying to say is that it good for companies to look at their workforce in longer term segments. I'm not saying in forever segments, but longer term than they do now. There are a few prescient companies out there who realize the value of building strong employee groups, and thus want to instill loyalty by showing loyalty towards their employees. This is a long-term view that is totally in line the health of the company.

Now, it is certainly true that economic realities demand action in order to keep the company afloat. But it doesn't mean that one must bring out the axe at the drop of a hat. Some companies have asked their staffs to ALL take a pay cut in these troubled times so they don't have to lay people off. Sometimes this is enough to solve the problem, sometimes not. But it's a more humane, and more creative, way to keep the company going. To close the loop there should be steps in place to return salaries to pre-recessionary times once the company is healthy again.

I'm not surprised that companies are scrambling to stay alive these days. I'd just like to see their solution to be the least damaging to the company, the employees, and the country overall. With creativity, and cooperation those things don't have to be mutually exclusive.

Price controls and protectionism do not work. They never have and they never will.

I'd disagree, but that's a another discussion for another time.

Thanks for the chat.

Profits are up, so let's cut some ordinary working folks and give ourselves bonuses! Whoo-hoo!

At the risk of getting other people angry at me, it says Freight lost 16 billion, while the 'overall' company made money.

One of the OpCos under the big "FedEx" umbrella isn't doing well, and a company doesn't want to use Express or Ground to cover for the losses in another one of their OpCos - so they're going to adjust that particular OpCo to try and make it profitable.

If you read the article, the message should be clear, as glass:

this division is not making money so we can not give our stockholders the dividend that we projected and forecast, therefore we are cutting employees so that the numbers are more favorable and our investors are happy.

If you do the math here the investors are losing $1.00/100 shares from the project amount to the actual amount. They do not like to lose so the stock is being sold and the company price per share is dropping. Unhappy board and stockholders so they have to cut jobs to brighten the picture and sweeten the deal for investors. However, since none of us can do anything about it, the point is a moot one.

Price controls and protectionism do not work. They never have and they never will.

I suspect the reason protectionism doesn't work and never will for you, is because you find that paying a living wage decreases the amount of your take. Interesting how "protection" is a solemn promise that some politicians maintain when it comes to fetuses, veterans, elderly, etc, but becomes an obscenity when the subject becomes American jobs.

Protectionism does indeed work: a protectionist tariff built US industry in the 1800's, protectionist trade limitations in the colonies built the British Empire, and China's economic revolution relies heavily on protectionist measures.

Free trade, on the other hand, may well soon have all but the wealthiest in this country working for Chinese wages and living in poverty.

Davy,

My 'take' is my wages, same as any other employee. Give me a strict definition for 'living wage'.

AA,

This isn't the 1800's, and China's economic revolution is based more on the US buying their crap and currency manipulation that protectionist tariffs.

Our standard of living will be equalizing with China's as a function of globalisation. If you want to make it happen even faster, then implement some protectionist measures against them and see how long it takes them to retaliate. We are not holding any aces in this game gentlemen.

AdipicAcid

Profits are up, so let's cut some ordinary working folks and give ourselves bonuses! Whoo-hoo!

The average CEO must be a sociopath, apparently.

These CEO's want more money in their pockets, used the people/workers for profit gains and cut them out so they can line their pockets with all the money they made from the workers they just terminated.

GREED! Hopefully the people will start revolting against these big business and CEO's and take back what's their. All that money these CEO's and Big Business stole from them. Without the people, these companies and business wouldn't have squat.

REVOLUTION People!

Sugartree,

This idea that the company owes you something for working for them is foreign to me. Whether he worked there for 30 days or 30 years makes no difference. The company owes him a days pay for a days work.... nothing more and nothing less.

Oldmustang 42.............. what a elitist corporatist fuc*-you kind of comment that is.

This man had WORKED for 30 years. (forthose who bit*ch about lazy entitlement citiznes) not only has he done his job, he has been a productive member of society (another phrase that pin holes those who are unemployed) and provided for his family and then some........ and you come in here and reduce what he's done on behalf of FEDEX, who is blantantly reducing their responsibility to their worker, so they can keep up with their stock holders.....

priceless.

this is were we are folks............. get used to it.
your just workers.
screw your work ethic, the corporate system has taken your country and is patting you on the back for making it all possible.

Our standard of living will be equalizing with China's as a function of globalisation

You first, buddy.

implement some protectionist measures against them and see how long it takes them to retaliate. We are not holding any aces in this game gentlemen.

Oh, I'd say we're holding some; if we don't buy all the crap they make, what're they gonna do with it? And in view of the trade "balance", I'd say they don't have a heluva lot of wiggle room to retaliate with.

I would define living wage as one that provides enough to cover the bills. Interesting how the federal min wage amounts to $.50 an hour more than the average (40 hour) Social Security retirement benefit. I suspect that the wage you're willing to pay for those who make what you buy fits nicely with the "globalized" Chinese standard, while you're "take" and investments are just a (large) tad nicer.

GREED! Hopefully the people will start revolting against these big business and CEO's and take back what's their. All that money these CEO's and Big Business stole from them. Without the people, these companies and business wouldn't have squat.

... without Fred Smith, the CEO of FedEx, FedEx wouldn't have existed as well.

But... are comments like that where 'people need to take back the reins of business' really meant to be the socialistic or communistic sounding thing it reads as?

Work................. is being downsized, much more frightening then companies being downsized.

figure that out.

the other reality.........is the number of mis/disinformationists in here.

figure one of these out........ and you're almost there.

free,

Niiiiice. Yes this man worked for 30 years, and? I assume he was also paid his due wages for 30 years. The fact that you think that he is entitled to anything more than that is exactly why this country is so jacked up today.

I have been working since I was 14 years old. Before accepting every single job that I have ever had, I knew what my salary and benefits would be. If they changed(for better or worse) at any point during my employment it was my choice to stay or go elsewhere. To expect anything more is ridiculous and naive. If you want to insure that you are treated as someone special, then start and build your own company.

Davy,

Wages in China are increasing. They are not nearly as high as those in the US, but they are growing every year, as are the wages in India. As this happens, the Chinese people will be buying up more and more of their own crap and improving their own standard of living. China's growth going forward will be due largely to the increasing size of their own middle class, and the buying power they will be gaining, not on selling to the US.

Enough to cover the bills? What bills will be covered? The individuals choice of cell phone and data plan? Cable/satellite TV? Car payment? Subsidised housing to live in a 'safe' neighborhood? Who make these decisions? Do you really think the living wage can be the same for someone in Manhattan, NY. as opposed to someone in Paw Paw, IL.?

I suspect that you know nothing about the wage that I am currently earning. I will tell you this though..... if at any time I feel that my compensation is not equal to my perceived worth, I am free to quit this job in order find another whose compensation is more in line with my expectations.

Niiiiice. Yes this man worked for 30 years, and? I assume he was also paid his due wages for 30 years. The fact that you think that he is entitled to anything more than that is exactly why this country is so jacked up today.

your point of view is are old world........... or neocon....... i'm still working that one out:)

I have been working since I was 14 years old. Before accepting every single job that I have ever had, I knew what my salary and benefits would be. If they changed(for better or worse) at any point during my employment it was my choice to stay or go elsewhere. To expect anything more is ridiculous and naive. If you want to insure that you are treated as someone special, then start and build your own company.

good for you, *pat on the back*........ i suppose you are looking forward to that social security check, or receiving it already.

the workforce is in contraction............. or did you miss that? It is a fact, many corp's are owning this behavior publicly. can't lead you horses to water anymore, you'll appreciate it more if you discover this on your own.

and by the way......... ownership is becoming as it was........ Obama is seeing to that. Him, and his neocon cabinet. don't get confused, i'm one of the idiots that voted for him, not to worry I'm wiser now. won't vote unless the money masters are outed and our choices are not the candidates of their choosing.

later.

I won't be able to collect SS for another 20 years or so. But when the time comes I will take whatever they are offering...... at one time it was my money after all.

The workforce is in contraction............. or did you miss that?

No, I didn't miss that. It's why I stated in an earlier post that labor is a commodity and subject to the laws of supply and demand. Right now it is a very loose labor market and the companies are calling the shots.

They are not nearly as high as those in the US,

No kidding...

As this happens, the Chinese people will be buying up more and more of their own crap...

Thing is, for them to get ahead these days, they frequently have to work long hours in sweat-shop conditions: the same sort of conditions rampant here before laws were enacted to protect US workers. But we're both correct about one thing: it is too frequently crap. Price is great, but watch out for the lead, among other hazards. Remember when we imported a sheetload of grade 8 fasteners? Making grade 8's is easy; all ya gotta do is put six little marks on the bolt head!

I don't believe many min wage people actually run around with many, if any, luxury items. Esp the homeless ones; but then, slick ronny musta had it right: they choose to be! Yep, it costs more to live in some cities, other than Paw Paw. That's why the min wage is higher in some states, for example, those who live in Paw Paw. Interesting you picked NYC. Business shills there managed to block any attempt to raise the wage above the US rate. No doubt the same, "If they don't like their wage, they can quit and go find better" bs. You try to present yourself as one of the ordinary workers, but your view of their situation says something quite different.

Gee, a thought just came to mind, mustang; if price controls can't work, can you tell me why we have government prices set for farm products??

Or why we implemented price controls to help win World War II?

Let's try this again:

If you read the article, the message should be clear, as glass:

this division is not making money so we can not give our stockholders the dividend that we projected and forecast, therefore we are cutting employees so that the numbers are more favorable and our investors are happy.

If you do the math, the investors are losing $1.00/100 shares from the projected per share amount compared to the actual amount. Losing is not in the best interst of the company or the investors. When investors are losing they sell the stock and the cost price per share is drops. So to keep the board happy and stockholders plentiful, they cut jobs. There is nothing wrong with brightening the projections and forecast and sweetening the pot for investors.

The divison may not be making money but if the projections and forecasts had been met, the jobs wouldn't be threatened or cut.

AA,

Rationing and price controls are not the same thing.

Davy,

You didn't answer any of my questions.

There were price controls on top of rationing of war essential materials. The government decided that runaway inflation on the things that weren't rationed was not in the nation's interests. There were also price controls during World War I.

The 2 cities in the US with the most rent controlled properties are New York and San Francisco. Now, which 2 cities in the US have the highest average rents........ wait for it........ that's right........ New York and San Francisco.

Rent controls/price controls don't work.

So price controls do not automatically work? Good thing that isn't what I was saying. What I was saying is that they do not automatically not work. In other words, it isn't enough to shout "price controls! bad!", instead you need to show why price controls in this case are bad. That means marshaling evidence and making a coherent argument longer than a bumper sticker slogan.

It also means using accurate evidence. Such as the fact that price controls were indeed part of the wartime economy alongside rationing, not trying to falsely deny that they were used so that the oversimplified argument still holds.

You're right. I could have referenced a time when we sent hundreds of thousands of soldiers over seas to fight a war. A time when women worked the factories because all able bodied men were fighting, when auto manufacturers re-tooled to make tanks and jeeps. A time when airplane manufacturers re-tooled to produce fighters around the clock. A nearly unprecedented time of cranking up the us war machine.

Then I could hold the economic apple from 70 years ago next to the economic orange of today and state we used price controls during WWII as an excuse to justify implementing them today.

Who are the share holders? Rich Union pension funds....

I believe FedEx is non-union!

mgbirish, so what? It seems you don't understand that all Unions invest the money from their pension plans into the stock market, and are some of the largest investors in the stock market.

I would think they would invest in UPS, union company. Everybody invests in the market, why single out unions. GE has a pension plan worth 29 billion dollars, they invest in the market.

I believe FedEx is non-union!

I do not know whether it is or not. Also the union local is the workers. Union stands for "You and I are one. It gives the employees a collective voice and in doing so, gives them power. It is a pity that most people do not know this. What the international has or doesn't have is no reflection on the local itself.

The point pf this article, though, is that profits are more important than employees.

all Unions invest the money from their pension plans

They do, but I believe most Unions have investment policies that do not allow them to or severely limit their ability to invest in non-Union companies.

No they don't.

They invest in what makes money, and these Union pension funds are some of the largest investors out there. Calpers is worth over 200 billion.

Our landlord is the for-profit arm of the AFL-CIO's REIT. All building maintenance and other direct employs of the landlord are required to be Union, per the REIT. When we moved in, we could only hire Union construction firms to perform the build-out and Union movers to move us in.

That has nothing to do with investing actual pension money into the stock market. That has to do with hiring Union labor.

investing actual pension money into the stock market

Every Corporation invests their pension plans in the stock market! Do you have a 401k? If so you invested in the stock market for your personal pension benefits. Your argument goes for everyone, not just the unions.

Ryan-

Fail. This is not about unions, or what their pension plans may, or may not invest in. This is just your Strawman attempts to derail the real issue here, and that is about a company who has doubled their profits is laying off workers. Period.

Leave the unions out of this.

Ryan ,you brought up something that is in need of changing...The practice of exposing other people's retirement money to an obviously corruptible enterprise that can go from being held firmly in check by government oversight of all the credit markets to an enterprise that, in their collusion and scheming together in private can succeed in buying an entire presidential administrations' loyalties of them....Considering the intentional paralyzing of oversight, defending their leadership in which their jobs suddenly become so easy that they no longer are allowed to work as devoted public servants...and, this is how we are eventually convinced that our FEDERAL government is the enemy....by poisening it with neo-con cronies who have spent their lifetimes learning how to escape public service while elevating their cowardice to a cornerstone status within their perceived blue-blooded foundations.

Blaming unionsunionsunions is just plain insincere and shallow pomposity. All mutual funds that hold in trust ANYONE's designated retirement money should have no authority or legal maneuver that would put that cooperative pool AT RISK. The goddamned 'private' sector lobbies for absolute freedom of what they do with their money, and if that can screw up the entire socialist...union-instigated retirement funds of their sheeple, well, that's just a good, easy scam that all 'investors' in such lobbying SHOULD be given their due for @!$%#ing them @!$%#ers over, who shamed their ilk into giving the workers under them the dignity of an adequate regard and respectful, sincere gratitude that extends out from their workers to their families and their communities.

'Value'......the value of the worker's strike is there, same as it was before the unions.... These are not ungrateful @!$%#s as you'd suggest, for wanting AND demanding they be valued and protected from abuse, neglect, mismanagement, and evil manipulation. Defend your 'instititution' called 'free enterprise', that isn't giving the people a goddamned thing free...That lies and invents farsical 'need' for unaffordable, unneeded baubles and sparkly things that we're ALL forewarned enmasse to 'not get left behind' in having this cheap disfunctional toy, and all the while creating every entrepreneur's intentions to prey on the less astutely schooled and impressionable ignorants by putting their ignorance on golden-leafed pedestals of proud, purposeful-looking spoils that only Americans are worthy of. All the while insatiable and ungoverened greed gets a pass because the greedy have been SOOOO successful....and their customers have been driven into debt for the sake of....a frikkin' shallow-assed perception that their conditioned wills cannot resist. Passive...unthinking....genies in your bottles, greed....

...and, now you, sir...do the ultimate twist in logic as to what an impeccable American should think he has earned, created, & deserved from those he committed his time and best efforts towards, knowing his employer will likely avoid awarding his 'kind' tangible evidence as to his worth and recognition....Money enough to, at least for a short while, allow a family to slumber in a contentment that only comes from the alleviations of stress, safe from the consequences that make living itself disfunctional.... that fate has for us all those times when our security and health brought fear and anguish with its pain and torment. Nobody has bothered to cure the society that preys on itself, hoping to profit off its selfish reasoning...that feeds on itself, and does violence with its proud, crooked rules of law that mock humanity...that mock all comers below a certain pedigree of influence and attitude. Peace is a conspiratorial tool, Love is a premise that all the others use to own the wealth around them and subjugate those who could have them as willing slaves...in their greedy, devious minds...

More women today than men are now the primary money earners in America...You think their '30% off' employee earnings, and their potentially manipulated sexual talents among those in the club houses of management with amoral, unscrupulous 'talents' aren't getting rewarded as well as the CEOs who pacify them into yes men? There's no power struggles...no competition within these multi-national companies....That is an act of heresy....sooo, just don't ever get caught.... Save that war for the 'competitors (what competitors?) like....those who might do espionage on us...steal our patents...formulas...management concepts...

Save that for the PR exploratory team arming against our foreign partners....ransoming the evidence that will end those dreams of conquest, and the spoils that follow the world over...

Jimster, just pointing out that the "rich shareholders" wiseguy pointed out were in fact the Union pension funds.

Sorry for pointing out that Unions continue to kill jobs all across America. Union pensions funds are the single largest investors in the stock market. If companies are struggling to show enough of a profit, it's because their largest investors want more.

Why do they continue to demand these profits from these companies?

Can you name one Unionized business that is in good shape? The former CEO of GE made that comment and he s so correct, Unions are a disease.

Unions are not killing job all across the country. Big business is and they are blaming it on the workers. Unions are a disease to CEO's because they no longer have total control of everything; especially the employees. The employees are not demanding the profits from the companies, just a livable wage.

What the CEO's do not realize is that by making the employee happy, they can increase their profits for the employees will feel valued and will want to see the company succeed. They will work harder in a pleasant atmosphere; one in which they are appreciated.

Let's name a few Unionized industries:

Airline

Automotive

Teaching

Government

How are all those doing? Not well, and they all have Unions.

Can you name a Union industry that is thriving?

Police

Fire Departments

They are doing well?

In the area I live, we have contracted to the County to provide those, because they have become to expensive, and I live in a large Metropolitan area.

Not to mention, we just had a huge problem with Police and Fire Union corruption with the Chiefs allowing the person just about to retire to work an extreme amount of overtime, because their pensions are based off an average of their last two years.

huskergal, conservs do have one union that they strongly support: it's called AARP.

Business and their shills regard globalism similar to a grocery store. They love some of the foreign standards and enthusiastically support them: examples are the wage rate, benefits, and employee safety regulations and environmental laws (or lack of same). But when it comes to their own pay, perks, pensions, and of course investments, well hey, you gotta remember, this is the good 'ol USA!

Gimmee, and screw you, rabble; can you all say "double standard"?

neocons are re-energized and surging... against the expendable. this company may have its high points as an employer, however, the discussin has boldly pointed out what every other article points out.

we are divided and the neocons take advantage of that, add the disinformationist activity, and you have the recipe for continued deterioration.

Ryan,

Get off the kick the union thing you have. The union is not causing the industry into trouble; it's mismanagament.

In most cases, management has no clue of what the actual work entails. Therefore they do things that in the long run hurt the company. I know as I have been on both side of the table.

exactly...and unionized through the card check bill.

We are in a recession (actually really a depression), business are holding tight to their money because anybody with a brain knows that the way we are spending money we don't have is going to come back and bite us in the butt. As sad as it is for those who lost their jobs at FedEx, (join the club, I did too) I can't really blame the business for trying to prepare for the next round of economic trouble. It's only a matter of time. The business that survive will be those who were prepared.

I think the big problem has been the fast track trade agreements. Why are companies going to stay in this country when the get goods manufactured for slave labor wages overseas?

Sorry guys, your argument just doesn't hold water.

The business that survive will be those who were prepared.

They are not preparing due to a slow down in freight. They are worried about losing investors. Price per share drop means people are selling because they aren't earning enough. They are planning ahead, they are projecting and forcasting the earnings. These haven't happened yet, just numbers on a calculator. So they are taking steps to insur their investors are well compensated in ther future.

Why are companies going to stay in this country when the get goods manufactured for slave labor wages overseas?

How does that affect a delivery company in any way? FedEx (and others) need delivery personal, drivers, pilots, warehouses, etc. to be where the packages are coming and going. They cannot very well outsource that work to another country.

How does that affect a delivery company in any way? FedEx (and others) need delivery personal, drivers, pilots, warehouses, etc. to be where the packages are coming and going. They cannot very well outsource that work to another country.

Exactly. And since the US side of business is losing money, the US side of business loses the jobs.

Why can't they spread the earnings throughout he company?

This shows what the rage is in corporate governance is nowadays. Every single thing in the company has to be a profit center. While some of this is good, it can be carried too far.

The business schools are in part to blame for this attitude. They are not teaching how to manufacture something, or how to back or invent new and better products that help create jobs, they're taught how to ring out every last drop of under-performing assets out of the company with little regard for long range planning or the value of long-term loyal employees (and customers).

It has not always been like this. Companies for decades have survived quite nicely, with longer range planning in place. Willing to hang on to under-performing profit centers for the good of long-term gain. As a result boom and bust cycles (in employment levels) are much more frequent than they used to be, with all their attendant pains and upheaval.

We need to teach more stable business practices to our future MBAs.

Wouldn't have to lay off anyone, in fact.

Lower margins don't equal higher profits. Don't you think that FedEx has quite a few business analysts exploring the effects of changing prices (or other components of their business)?

If they'd cut prices a bit

... and they'd cover a 16 million dollar loss?

probably not as much as the Government Motors CEO who gets 9 million ( yeah, that's our money...thought they were going to do away with "obscene profits" and CEO pensions....hmmm)

Dan Akerson stands to make $1.7 million in cash and $7.3 million in deferred or restricted stock annually in his new job as General Motors' fourth CEO since 2009.

But consider this: Alan Mulally, CEO of Ford, which made a $2.7-billion profit in 2009, was paid $12.9 million last year in salary and benefits, as well as $5.1 million in stock options.

Top GM executives must still have their compensation approved by the U.S. Treasury "pay czar," who enforces salary restrictions at companies running on federal aid. Former pay czar Kenneth Feinberg ruled on Akerson's pay before his tenure ended Friday. Treasury lawyer Pat Geoghegan, who had assisted Feinberg, replaces him as acting pay czar.

Read more: Dan Akerson to draw $9M as GM CEO | freep.com | Detroit Free Press http://www.freep.com/article/20100911/BUSINESS01/9110303/Dan-Akerson-to-draw-9M-as-GM-CEO#ixzz0zheVjaVl

WTF-I wonder how much that CEO is making away with!

One thing to know about FedEx - the CEO is the man who founded the company back in the 70s.

http://www.commercialappeal.com/news/2010/aug/17/fedex-ceo-fred-smith-saw-his-compensation-drop-4-p/ has some information on it.

Last year, he took a 10% pay cut, with many of the other executives taking 5% or more cuts. They stopped company vehicles, they cut benefits, etc.

Combine that with him having built the company from literally the ground up, it is hard to be horribly mad at Fred Smith.

That makes me wish he had been CEO of my old human services outfit(nonprofit). Told for 2 years running that we would get no pay increase. I look in the publication "The List" over at Borders, and he's continuing to gain $3000 yearly. Scheister! Glad he fired me personally(He knew I was onto the administration)!

Profit trumps everything.

And corporations have no conscious...

tmac, yes.

Law is replete with items called 'legal fictions'. It's a concept where parties agree that a premise applies to a situation where the semantics fail.

Atheism as a religion, for instance.

The concept of a corporation, in fact comes from the word "corpus" or body. It was coined because, under conditions of archaic law, only a "body" could enter into contracts, own things or be sued. To those ends, a group of people join into an agreement to create a false "body".

My favourite legal fiction, is survival. If two brothers (or any people) die in an event or situation where it cannot be determined which perished first (ie., maybe they really died at the same time, our you can't tell), then the law stipulates that the older person died first.

Profit trumps everything.

Something missing is that Freight is a sub-company of FedEx. It has its own line of executives before it reaches the overall umbrella of FedEx. In this case, Loss trumps everything. Freight is trying to reorganize itself to make itself positive, not just sapping off of FedEx Express and Ground, etc.

In other words, the other business of the company aren't there to cover for the worser parts. Its like Best Buy - if the online site doesn't support itself with sales, they don't want to eat into the returns from the physical stores just to support a hurting part of their business. THey'll reorganize the online site.

Where was the revolution nine and a half years ago? That's when there should have been one!

That's ok when 200 million people are out in the street and nothing to eat. That's when the $hit will hit the fan i guess. Thats what they want that's what they will get!!!!!

Y dont the American people wake the fluck up!!! and take back our goverment?

FedEx doesn't have anything to do with the government.

"Or is it just to appease the shareholders?"

Since they own the company, all the employees better hope they are happy.

No Investors = No Jobs.

Who is ready to go back to an agrarian society?

I'm sorry, but it's time for the federal government to control the entire economy for the good of the People.

Absolutely the most ridiculous statement that I have read in a very long time.

Metal, I agree with you completely

please, Metal.......... break that out for me

when you say 'government'......... exactly.......... what do you mean?

Nobody's economics work. That is why each party gets elected every couple of years. Neither has the magic formula.

Awww rationalization...its a beautiful thing. I wonder how many people are buying into it? Hmmm. Libertarian?

Libertarian? No. Just honest. If the republicans knew how to control the economy, then they would win every election. Since they do not win every election it follows that they do not know how to control it. Same goes if the Democrats knew how to fix the economy. I am not rationalizing a thing; your head is in the sand.

So far, better than GWB's! How about voodoo economics? That set the stage for this mess....

Good comment. I think you have been able to help me understand some underlying causes of our jobs problem & a way we can all help & support American workers.

I'm convinced the system can be fixed, but it will only happen when we start to be as concerned about the demand side as we are about the supply side. It requires balance and integrity. We need to stop funneling money into the hands of people who create casinos with games like derivatives and pumping it into the hands of people who will put it to work by investing in things that actually benefit the many rather than the few.

Show be the job growth in 2004-2008...please

Correct, WatchTheOtherHand, and notice no one thought to ask the hidden important question:

The $2 trillion more in cash corps are hoarding due to tax til ya drop regime..how many of these 1,700 jobs would be safe were even $1 trillion spent on capital in US ($ are on US legal entities)? 1 trillion = 6 or 7 figure job creation, which if we conservative figure on even 1 Fed Ex worker needed to transport said goods for each 1,000 capital created jobs translates to a 3 to 4 figure quantity of Fed Ex jobs going bye-bye becuase of the $2 trillion.