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PepsiCo Is Laying Off Corporate Employees As the Company Commits To 'Relentlessly Automating' (businessinsider.com)
PepsiCo is kicking off a four-year restructuring plan that is expected to cost the company hundreds of millions of dollars in severance pay. "This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off," reports Business Insider, citing two people directly impacted by the layoffs.
The latest job cuts come after CFO Hugh Johnston told CNBC that the company plans to lay off workers in positions that can be automated. CEO Ramon Laguarta said on Friday that PepsiCo is "relentlessly automating and merging the best of our optimized business models with the best new thinking and technologies." From a report: This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off, according to two people who were directly impacted by the layoffs. These two workers were granted anonymity in order to speak frankly without risking professional ramifications. At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider.
By PepsiCo's own estimates, the company's layoffs are expected to be a multimillion-dollar project in 2019. Last Friday, PepsiCo announced in a filing with the Securities and Exchange Commission (SEC) that it is expected to incur $2.5 billion in pretax restructuring costs through 2023, with 70% of charges linked to severance and other employee costs. The company is also planning to close factories, with an additional 15% tied to plant closures and "related actions." Roughly $800 million of the $2.5 billion is expected to impact 2019 results, in addition to the $138 million that was included in 2018 results, the company said in the SEC filing.
The latest job cuts come after CFO Hugh Johnston told CNBC that the company plans to lay off workers in positions that can be automated. CEO Ramon Laguarta said on Friday that PepsiCo is "relentlessly automating and merging the best of our optimized business models with the best new thinking and technologies." From a report: This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off, according to two people who were directly impacted by the layoffs. These two workers were granted anonymity in order to speak frankly without risking professional ramifications. At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider.
By PepsiCo's own estimates, the company's layoffs are expected to be a multimillion-dollar project in 2019. Last Friday, PepsiCo announced in a filing with the Securities and Exchange Commission (SEC) that it is expected to incur $2.5 billion in pretax restructuring costs through 2023, with 70% of charges linked to severance and other employee costs. The company is also planning to close factories, with an additional 15% tied to plant closures and "related actions." Roughly $800 million of the $2.5 billion is expected to impact 2019 results, in addition to the $138 million that was included in 2018 results, the company said in the SEC filing.
I am a professional chess and Go player. Fortunately for me I am safe from automation.
Sounds more like Wipro or Infosys got a sweet contract than just "automation."
Computer chips are tech, tortilla chips aren't.
but they really mean that their jobs are safe from being replaced by small shell scripts or primitive AI services.
And some wonder why employee loyalty is so low...
I think this was supposed to benefit people? Wasn't that the whole idea"
In other words, all the involved will receive huge quarter bonuses for a few years, then once it badly backfires they will have departed with golden parachutes, while PepsiCo fills for bankruptcy, right?
Conservatism: (n.) love of the existing evils. Liberalism: (n.) desire to substitute new evils for the existing ones.
Anyone knows whats the average severance package so we can make an estimate on how many people will be permanently unemployed from now on?
I am totally looking forward to the significant cost savings of these changes being passed on to us consumers.
BWAHAHAHAHAHAHA. Sorry. Couldn't keep a straight face.
At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks
Are they training the robots?
Towards real sugar and returning to their original recipes?
For people who don't remember, Mountain Dew used to give you a sugar rush, not a caffeine rush. Pepsi with real sugar has no aftertaste, making it more refreshing, etc.
Personally I haven't seriously drank pepsi products in over a decade and this decision will just make that easier to swallow, heh heh.
After I aged out of my engineering job, I knocked off a MD. it was four years of memorization. All it takes is understanding of basic science.
I wish I just went directly into medicine. I'd be rich and it would have a lot easier than engineering. My colleague has an undergrad in art. The other in accounting!
You want a Universal Basic Income? Buy shares in PepsiCo.
Better yet, form an ETF which invests in all such "relentlessly automated" companies, and then which uses its clout on their boards (i.e., uses its collective bargaining) to declare sizable dividends. Boom. UBI for shareholders of the ETF.
All voluntary.
Ever see a video of food and drink factories? Food companies have been using automation for decades.
If you need a reminder, here's a video, it should be easy to count the people, lol:
https://m.youtube.com/watch?v=ekPrFT5nPvg
How much talent does it take to sell diabetes-inducing sugar water anyway? "Automation" is is another word for "contractors in India".
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The statement is BS.. You're not automating if " layoffs will continue to work at PepsiCo until late April as they train their replacements".. You don't train your automated replacements. You're outsourcing existing high priced labor to cheap (aka illegal?) labor.
Fortunately India, which is where production is largely being moved to, is known for its quality drinking water.
#DeleteChrome
What a difference between a soft spoken empathetic Indra and this guy. She built the company up. Now he is going to loot it along with his other C suite cronies. The c stands for crony or criminal I wonder.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
What jobs are they automated?
I visited a bottling plant in the 90s and it was mostly automated even back then, so I can't imagine that there were that many jobs left, unless they are automating office jobs.
Sounds like a method of getting rid of all the old people working there, then in a year or two will say they failed and hire young people. Sounds like a good plan to avoid all those pesky US regulations.
PepsiCo's board chose to further their cost-saving automation by replacing the CEO with a Magic 8 Ball, which they said "gives predictions which are just as accurate".
Where are going those jobless people go? weren't they supposed to improve workers lives with the tax cuts?
these guys aren't 'training' their robots to take their places.. they're 'training' imported visa-holders and sub-contractors who will replace them at lower pay and/or reduced-to-no benefit packages.
the 'automated' bits aren't at the fucking corporate offices.. its at the bottling plants and warehouses.. and any severance packages there for laid-off workers are paid for by cost savings.
"relentlessly automating and merging the best of our optimized business models with the best new thinking and technologies." AKA let the best PowerPoint win.
A few years ago after they completely gutted and refurbished their aging HQ building in Purchase NY, I was on the team that installed new HP printers a few days before all the employees returned from their temporary offices spread around White Plains, NY.
What did you expect? Seriously?
Wah wah wah whines the Russian who can't afford American soda with inflates rubles.
All customers will be automated, along with the production.
I mean, yeah, you're making your processes efficient, but your drink is still shit and just bottled sugar. Sure, I would say, great - you're making that drink cheaper but your drink still sucks.
I hope those employees get a better job elsewhere and this signals the beginning of the end for this corporation.
We should logically automate the highest paying jobs first, as it offers the biggest savings.
Let's automate management before we automate labor. Sure a Magic 8 Ball is just a 20-side die floating in liquid, but I'm sure we can design something twice as complex and capable of replacing a senior VP.
Honestly: I can't think of any Pepsi products that I buy, anyway (and yes, I know the whole list). IMO opinion this says more about the state of commodotized food than it does workers. Seriously: the chains you see at malls these days are often of the caliber that boutique restaurants used to have exclusive license on. Who needs Taco Bell?
...not just more profits for robber barons and vulture capitalists.
German workers win right to 28-hour working week
You can count me in! In fact, I started boycotting them over 30 years ago.
#DeleteFacebook
I "automated" not giving myself diabetes with their product a decade ago.
Let them all die. Just drive health care costs thru the roof to get rid of them faster while our robots works for us.
New World Order.
"..fizzy piss water."
You're confused, AC; you're actually thinking of Budweiser, or maybe Pabst Blue Ribbon.
They're automating a ton of back office work that used to be done by people. The jobs aren't going overseas. They don't exist anymore.
This is gonna be "interesting times" as more and more work is automated. It's the #1 buzzword at every tech place I know of. And it's happening faster than new jobs can be created.
Good thing millions of unemployed and unemployable people are never a problem for long term social stability.
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seriously. Yes, age discrimination is technically illegal. You'd have a better chance getting H1-B restrictions enforced than age discrimination rules. There is literally nobody enforcing it. Remember, it's not a law if it's not enforced.
And this is automation. They're not hiring young folk. They're not hiring _anyone_. The jobs are just gone. Poof.
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Civilized != Capitalist
But don't worry, Europe will succumb too, sooner or later.
Learn to code.
"At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider. "
then
"At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider. "
They're training the robots or the other automation? Uhhh....
Coke is it, from now on.
"professional ramifications"
What professional ramifications? You're already losing your job.
....what happens after two years?
...it's just another reason not to drink Pepsi.
Automation my ass. Can't automate my job and I was laid off
... in the future, when only the AI's have a job?
Pepisco automating back office work? Word processing and Spreadsheets has been around since the 80s. Pepsi has been around longer than that. What recently developed technology by 2019 will allow Pepsico to automate all those back office jobs, which have not already been automated?
As slashdoter has posted:
"The statement is BS.. You're not automating if " layoffs will continue to work at PepsiCo until late April as they train their replacements".. You don't train your automated replacements. You're outsourcing existing high priced labor to cheap (aka illegal?) labor."
That sounds more plausible.
"..fizzy piss water." You're confused, AC; you're actually thinking of Budweiser, or maybe Pabst Blue Ribbon.
We used to call Miller's beer "Panther Piss", so maybe that's the one he's thinking of.
Inventory management, sales and purchasing. Like most companies, they have an army of paper pushers on payroll, dealing with customer orders, submitting orders to suppliers, keeping track of how much of what needs to get to any given location at any given time, paying bills and checking that customers have paid their bills. Most of it is boring repetitive work that doesn't actually need human interaction and can be better handled by a sufficiently clever accounting program. It's pointless busywork and there is no good reason anyone should waste their lives on that crap.
All hail The Machine! Down with humans! Paying people is bad. Don't do it! Fire them all. Now!
Wait what? No sorry a bunch of people wanting to work part time for reduced pay is not the civilised end-result of automation. This is even temporary so workers aren't able to elect to do this beyond 2 years. This was nothing more than a work-life balance related negotiation tactic to not offer the original promised pay increases. It's great virtue signalling because we all know that people desperate for a 6.8% pay increase will jump at the idea of a 27% reduction in pay.
They also took careful aim at their foot there. The logical end game of their shorter weeks which the company can't deny is for a company to automate their work. Expect these people to ultimately lose their jobs when it becomes clear that they weren't providing 37 hours of value in the first place.
So of course we should all be hearing very soon from the media and the Democrats how horrible this is that they are getting laid off (not furloughed) and that something needs to be done to reopen PepsiCo right?
Bingo, the southern states in the U.S. have the worst obesity rates in the country. The are also the most opposed to the ACA and Medicare for all. They simply do not equate their lifestyle with their death and health rates, and the Republican pols are not about to inform them of the link.
Have you ever worked or do you just spend all day crying that mean ol gubmint gibs you more handouts?
Because once we've all be automated out of a job, no one else will be able to afford it.
Always looking for their market.
Good luck with the automated. I won't be supporting the company nor its product.
Believe it or not, but you can do office automation with just office word or open office, and a printer. I did it in the IT departement of a public hospital. Then I got layed off, in my turn, when I finished my engineerings tasks.
Dude stop trolling. What you are saying is pure fiction, totally didn't happen before :)
http://content.time.com/time/specials/packages/article/0,28804,1848501_1848500_1848428,00.html
Few examples (out of of MANY):
(i) so called stable 'production' industry:
James Kilts wasn't fired from The Gillette Co., he just lost his job. When Procter & Gamble absorbed Gillette in 2005, the CEO position was made redundant. So Kilts took a $165 million payout, plus another $13 million to cover the transaction's resulting taxes.
(ii)
"With Fiorina as chairman and CEO, Hewlett-Packard's value declined significantly and the technology giant endured massive layoffs.
Fiorina led a largely unsuccessful merger with Compaq in 2002, going against the wishes of company founder Walter Hewlett. Asked by the board of directors to step down in 2005, Fiorina left with $21 million in cash, plus stock and pension benefits worth another $19 million."
Seems like upper cockroaches i mean management like to read slashdot a lot cause parent was modded as troll.
they're measuring productivity growth in all sectors of the economy, specifically they're measuring productivity of retail workers. Think cashiers and stockers.
There's a finite amount of work you can get out of a retail worker. Walmarts added robots to take inventory and Amazon's working them to the bone, but we're hitting the limits there.
Manufacturing & Farm outputs, which is the real measure of productivity increases, are way, way up.
As for unemployment, more lies. They're including "gig economy" workers. e.g. Uber drivers. Those aren't real jobs. Most of those folks are basically mortgaging their cars to get by. Eventually the maintenance will come due and the whole system will collapse. With modern cars we've got about 5 more years. Incidentally, a major recession just happens to be on the way....
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Pepsi, the choice of a screwed generation.
I worked in a Pepsi bottling plant in the early 1980s. At that time, the equipment was pretty much all 1950s era stuff, incredibly robust and repairable.
Most of my job was picking up cases of soda and loading them on trucks that came in one side of the building and left out of the other. Occasionally I had to clean up spills, leakage and breakage.
I have very fine (e.g. opposite of coarse) hair. When I got home after a shift, my hair was a solid, continuous block of sugar absorbed from the air. You could bounce a superball off it. Every inch of exposed skin had a coating of sugar and sweat salt. You could feel it in your lungs, too.
There were no jobs in that plant that could not be completely automated away today. Not one!
Sadly, corpo suits ignore Henry Ford wisdom.
This is how the stock market and hedge funds destroy the economy and our children future. The fact that unemployed masses of the future will not be able to afford to buy their products doesn't compete with the next quarter bonus.
Things were much healthier when companies were privately owned by families.
Unfortunately that is not coming back, so we will be at some point speaking Mandarin and living in a total surveillance state as the Chinese think long term.
Even better, now that their 40 hour/week pay is now 28hr per week, and the company invests in automation, the company wont pay much more buy keep pushing for shorter n shorter work week until its 10hours a week a 1/4 the pay. Yay.