© The Financial Times Ltd 2014 FT and 'Financial Times' are trademarks of The Financial Times Ltd.
November 7, 2012 5:35 pm
Three of the biggest companies in the Nordic region on Wednesday announced plans to slash thousands of jobs in a further sign that Europe’s economic problems are catching up with businesses in what was perceived as a haven.
Vestas, the Danish wind turbine manufacturer, said it would cut a further 3,000 jobs on top of the 3,700 already announced this year, amounting to about 30 per cent of its total workforce.
Ericsson said it would cut almost every 10th job in Sweden, leading to 1,550 losses, while Danish brewer Carlsberg revealed plans to cut an unspecified number of jobs as part of plans to boost its efficiency.
Each set of job losses have company-specific circumstances, but they also show the growing impact on companies in the Nordic region of the sharp economic downturn in the eurozone.
Dag Andresen, chief financial officer at Vestas, the world’s largest turbine maker, said: “The Nordic region was the market that was least impacted after Lehman Brothers. Now we see things are hitting the Nordics. This is a lagging effect.”
Vestas is reversing its rapid expansion of the past few years as falling government support means wind turbine orders have collapsed in recent months.
Jørgen Buhl Rasmussen, Carlsberg’s chief executive, told the Financial Times that the Danish brewer needed to cut costs to counter the continuing decline in beer volume in western and northern Europe.
“It has meant job losses and it will continue to mean that . . . We [in the Nordic region] are not isolated from the rest of Europe. [But] in general the northern part of Europe is in better shape than southern Europe and from a business point of view it is a better environment, even if it is very challenging,” he added.
His comments came as Carlsberg reported a third consecutive quarter of rising market share in its crucial Russian market, which accounts for 40 per cent of its sales and where a series of regulations and taxes have dented profits and sales in recent years.
Ericsson, the world’s largest telecoms equipment maker by sales, is following its rivals such as Alcatel-Lucent and Nokia Siemens Networks in cutting jobs in the fiercely competitive industry. NSN said last year it would cut about 17,000 jobs while Alcatel announced plans this summer for 5,000 losses.
Torbjörn Isaksson, chief analyst at Nordea in Stockholm, said the surprise was that Nordic economies and companies had escaped the effect of the downturn for so long. “It is clear that the export industry is hit by weak global demand but it is still no big drama on the labour market,” he added.
Additional reporting by Daniel Thomas in London
Copyright The Financial Times Limited 2014. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.