BROKERAGE TO CUT JOBS; MERRILL LYNCH LEADS RETREAT IN CRISIS.Byline: Rachel Beck Rachel Beck is an American reporter for the Lebanon Express in Lebanon, Oregon. Born 5 April, 1982, she was raised in Sisters, Oregon. In 2000, she graduated from Sisters High School[1]. She graduated from Vassar College with the class of 2004. Associated Press Associated Press: see news agency. Associated Press (AP) Cooperative news agency, the oldest and largest in the U.S. and long the largest in the world. Merrill Lynch Merrill Lynch & Co., Inc. (NYSE: MER TYO: 8675 ), through its subsidiaries and affiliates, provides capital markets services, investment banking and advisory services, wealth management, asset management, insurance, banking and related products and services on a global basis. & Co., giving the first sign that Wall Street is cutting back after months of global economic turmoil, will eliminate 3,400 jobs, or 5.2 percent of its work force. The layoffs announced Tuesday are expected to be the first of many job reductions on Wall Street following the recent turbulence in global financial markets. Industry observers, however, don't anticipate the cutbacks to be as severe as those in the late 1980s, when more than 50,000 jobs were lost following the stock market's crash in October 1987. ``A decade ago, we saw a combination of massive trading losses The following contains a list of trading losses which eventually forced major corporations to go bankrupt or restructure parts of their organisation. This list is not exhaustive. combined with a halt in most businesses conducted by brokerage firms,'' said Michael Flanagan, an analyst at Financial Service Analytics in Fort Washington Fort Washington, military post during the American Revolution, situated on the highest point of Manhattan island, New York City, overlooking the Hudson River opposite Fort Lee, N.J. , Pa. ``Today, we are seeing modest layoffs, not a general layoff policy for the entire industry,'' he said. ``This is a dose of reality that the tide has turned on Wall Street.'' Separately Tuesday, investment firms Donaldson, Lufkin & Jenrette Inc., and PaineWebber Group Inc. reported lower earnings due to the global economic volatility. DLJ's quarterly profits dropped by 79 percent and PaineWebber was off 36 percent in the June-September period. At Merrill Lynch, the job cuts will come throughout the company and will be achieved through layoffs and attrition. The company did not specify what divisions would be hardest hit. In addition, the brokerage will trim an additional 900 jobs that are filled primarily by outside consultants who are mainly involved in technology projects. ``We've been in a 10-year bull market and they needed to staff up to accommodate that,'' said Linda Chase-Jenkins, managing consultant at Towers Perrin Towers Perrin is a global professional services firm. It was established 1 March 1934 as Towers, Perrin, Forster & Crosby. The umbrella name of Towers Perrin was adopted in 1987. , a New York-based business consulting firm Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee consulting company business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a . ``But business has been drying up since the summer, and earnings are down.'' Merrill Lynch, the world's biggest brokerage firm, also reported Tuesday a loss of $164 million, or 49 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on a diluted basis, for the third quarter. It earned $551 million in the second quarter of 1998. Merrill Lynch will take an after-tax charge of $288 million to cover the costs related to the staff reductions. It expects the restructuring to result in annual savings of $500 million. CAPTION(S): Photo, Chart PHOTO (Color) Merrill Lynch Chairman David Komansky talks via video at a news conference with President Herbert Allison in this June 22 photo. John Lehmann/Associated Press CHART: THIRD-QUARTER REPORT Merrill Lynch & Co. was hurt by the volatility of financial markets around the world. Its results were below analyst expectations. |
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