UPS layoffs 2024: 12,000 jobs cut just months after reaching union deal
WASHINGTON - UPS will cut 12,000 jobs and released a revenue outlook for this year that sent its shares down sharply.
The company also hinted that its Coyote truck load brokerage business may be put up for sale. UPS acquired the Chicago-based company for $1.8 billion in 2015.
The Teamsters in September voted to approve a tentative contract agreement with UPS, putting a final seal on contentious labor negotiations that threatened to disrupt package deliveries for millions of businesses and households nationwide. The contract includes pay raises for full- and part-time union workers, the creation of 7,500 full-time jobs and the filling of 22,500 open positions, allowing more part-timers to transition to full-time.
On a conference call Tuesday morning, CEO Carol Tome said that by reducing the company’s headcount, UPS will realize $1 billion in cost savings. The job eliminations are anticipated to be among management roles and contractors, the company said.
UPS also said Tuesday that its board approved an increase of 1 cent in its quarterly dividend to shareholders of record Feb. 20.
"We are going to fit our organization to our strategy and align our resources against what’s widely important," Tome said.
Tome said that UPS is ordering employees to return to the office five days a week this year.
United Parcel Service Inc. anticipates 2024 revenue in a range of approximately $92 billion to $94.5 billion, short of Wall Street’s expectations for a figure above $95.5 billion.
Shares of UPS dropped nearly 8% on Tuesday.
Revenue also came up short in the fourth quarter, sliding 7.8% to $24.92 billion. That’s just shy of Wall Street projections for $25.31 billion, according to a poll of analysts by FactSet.
Profits for the quarter ended in December slid by more than half to $1.61 billion, or $1.87 per share, from $3.45 billion, or $3.96 per share. On an adjusted basis, quarterly earnings per share totaled $2.47, a penny above the average estimate, according to FactSet.
UPS Layoffs 2024: D.C., Maryland & Virginia impact
This comes just a few couples after UPS hired hundreds of seasonal workers in the D.C., Maryland, and Virginia areas to help with the holiday rush.
As part of a tentative five-year contract agreement with the Teamsters union approved in October that included a bump up in pay and other benefits for part-time and full-time workers, seasonal package drivers will start with hourly pay of $23, while package handlers will get $21 for the holiday period.
READ MORE: UPS hiring in DC, MD, and VA for seasonal worker jobs to help with holiday rush
The Associated Press contributed to this story.
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