Nestle is reportedly undergoing a transformation in terms of how it works. But this is coming at the cost of 16,000 jobs. Yes, in an attempt to reduce costs, the global food major is laying off about 12,000 white-collar employees along with about 4,000 workers in manufacturing and supply-chain roles. Is automation responsible for these job cuts?
To some extent, yes. In trying to make its operations more efficient, the company is looking at automating several white-collar jobs. Additionally, it is planning to cut its workforce by six per cent, globally over a period of two years.
According to media reports, Philipp Navratil, CEO, Nestle is calling this a transformation exercise, which is part of the company’s evolution, involving simplification of the organisation as well as automation. The objective is to streamline processes through digitalisation and automation.
The company witnessed a 1.9 per cent dip in sales compared to the same period in the previous year
While details are yet to be shared by the company about the locations and departments to be affected by the headcount reduction, each market will reportedly prepare its own plan for the cuts.
In early June this year, Nestlé India had also reported a 3.8 per cent decline in its permanent employee count for the financial year ending 2024–25. This reduction came at a time when the company was intensifying its capital expenditure efforts to build new capacities and enhance operational capabilities.