Office workers next to go
Layoffs are hitting white-collar workers at Clarian and Cummins, a sign that the recession is thinning salaried ranks after massive losses of factory jobs throughout Indiana.Hospital owner Clarian Health, one of the city’s largest employers with about 12,700 workers, plans layoffs early next year of an undisclosed number of salaried workers as it trims operating costs 5 percent.Diesel engine-maker Cummins, the fifth-largest corporation based in Indiana, said Friday that 500 professional jobs worldwide will be cut by Dec. 31 because of the global slowdown. About a quarter of Cummins’ 14,000 white-collar employees work at the company’s head office in Columbus or a smaller office in Downtown Indianapolis.Cummins and Clarian have begun to retrench as offices throughout the metro area slow hiring or let go of workers.This recession marks the first serious test at weathering a downturn for Indianapolis’ newfound economy since offices replaced factories as the city’s leading employer two decades ago.Although the national economy officially has been in recession for a year, the Indianapolis area still appears solid, reporting a record number of jobs in October.But with the U.S. economy in retreat, economists note, Indianapolis eventually could be pulled back.October’s is the latest job report for the metro area. The data shows about 900 fewer professional workers were employed in October compared with a year earlier.That’s helped raise the metro area’s unemployment rate: 5.2 percent in October, up from 3.7 percent a year earlier, the U.S. Bureau of Labor Statistics reported.After the 1982 recession raked the industrial Midwest, Indianapolis was transformed. It became a service center, with office, hotel and restaurant jobs replacing much of the old boom-and-bust manufacturing city.As high-wage factory work vanished, a category called professional and business services became the metro area’s economic engine, adding 67,000 jobs since 1990 to total nearly 131,000 jobs in October, the labor bureau reports show.The category includes lawyers, accountants, engineers, marketers and software specialists along with temporary workers, who are lumped in as service workers even though they might hire in at factories.But with the economy slow, even office jobs are not immune to being cut.“We, like everybody else, are being impacted by the economy,” said Steven Wantz, Clarian’s senior vice president of administration and human resources.Clarian plans to cut operating expenses by about 5 percent in 2009 — a move that will include cutting an unspecified number of salaried jobs. Other positions are being left vacant. Some people affected by the cuts would have the opportunity to apply for other positions within Clarian.Wantz said some of the cuts would come from areas such as finance, human resources and other back-office areas. No job cuts are planned for “mission-critical” positions providing direct patient care.Clarian employs 12,700, including about 8,500, at its Downtown locations, Methodist Hospital, Indiana University Hospital and Riley Hospital for Children.Wantz said most of Clarian’s financial challenges are coming from losses on its investments — typically a key source of money for large nonprofit hospitals — as opposed to a decline in reimbursement revenue.“It’s the same effect if you open up your 401(k) statement,” he said.Clarian is not the only local health-care provider trimming positions.Midtown Community Mental Health Center, a unit of Wishard Health Services, is eliminating about 20 of its roughly 546 positions.At Cummins, 200 jobs will be eliminated through voluntary retirements and the remaining 300 through elimination of jobs. This will amount to 3.5 percent of the 14,000 professional jobs in the company, Cummins spokesman Mark Land said.Because of rapid growth, the diesel maker employs about 40,000 worldwide, compared with about 27,000 in 2003. In Indiana, Cummins employs 6,000, including 3,700 professional workers.In metro Indianapolis, 47,856 people were on the jobless rolls in October, 14,000 more than a year earlier. At the same time, Indianapolis has added more jobs than it has lost, and in October it reached record employment levels — 929,900 jobs were filled.This was the most jobs recorded by the labor bureau in the nine-county metro area in any month in any year. It was 3,000 more than in September and surpassed the 1990s’ boom peak by 60,000 jobs.Despite the record number of jobs, the unemployment rate has climbed. In October, 16,000 more unemployed people were looking for work, a sign that people are coming to the city as layoffs mount elsewhere.Not counting the Indianapolis area, the state is struggling. In October, 2.03 million jobs were filled in the state outside the Indianapolis metro area, down 32,000 from a year earlier. The bulk of the job losses — 24,000 — were in manufacturing, labor bureau reports show.
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