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Second outbreak of the Coronavirus brings a massive wave of redundancies in the US

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This is an extremely difficult process. It’s very painful to know that you will end up saying goodbye to a lot of good people, says Shell CEO

As the US enters the final stretch for the November 3 presidential election, a growing number of companies from various sectors affected by the coronavirus are announcing tens of thousands of layoffs, and the impact of the pandemic continues to weigh on companies and households.

Continental Airlines, Dow Chemicals and Marathon Petroleum have already announced restructuring plans that include layoffs of tens of thousands of workers in the United States.

However, sensation sparked by Disney on Tuesday, that it will proceed with the layoffs of 28,000 employees in its theme parks caused a sensation, as it sufferes a heavy blow from the sharp decline in visits and the turnover due to the coronavirus pandemic.

Disney has reopened all of its theme parks, with the sole exception of Disneyland in California.  About two-thirds of its employees who are going to be fired are part-time, the company’s management clarified.

The decision is due to the “prolonged impact” of the pandemic “on our turnover” and the “uncertainty about the duration” of the health and the consequent economic crisis, the group explained.

From April to June, the group’s turnover fell by 85% year-on-year to $ 983 million.

At the same time, Shell announced this morning, a new layoff program for more than 9,000 jobs, or about 10% of its workforce, as the energy giant shifts to low-carbon oil and gas production.

The Anglo-Dutch company has said it will cut 7,000 to 9,000 jobs by the end of 2022, including around 1,500 employees who have already voluntarily agreed to leave the company this year.

The cuts are a move by Shell to reduce its corporate footprint and save costs when switching to low-carbon energy production.

“Job cuts, along with other measures, are expected to result in annual cost savings of between $ 2 billion and $ 2.5 billion by 2022. This will partly contribute to the underlying reduction in operating costs from $ 3 billion to $ 4 billion by in the first quarter of 2021 “, the company’s announcement says.

In a statement, Shell CEO Ben van Beurden stressed: “We need to be a simpler, more streamlined, more competitive organization that is more flexible and able to respond to their customers.”

However, as he pointed out, “this is an extremely difficult process. “It’s very painful to know that you will end up saying goodbye to a lot of good people.”

In terms of Shell’s oil production, there was a significant drop in production to about 3.04 million barrels per day due to declining demand and hurricanes off the Gulf Coast of Mexico that forced offshore platforms to shut down.

What is worrying about the US job market is that this second wave is coming at a time when the government job support program is coming to an end on October 31.

The White House has not yet reached an agreement on the new package to support the American economy, resulting in millions of unemployed people are at risk of finding themselves without any help.

The next period will be particularly critical for US companies, as if the increase in cases leads to new restrictive measures, then it is almost certain that there will be more layoffs.

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