Layoffs? What Layoffs? 

Businesses in the Memphis economy have developed a new lexicon to avoid the "L" word.

The slump in the national economy has had an impact on Memphis companies, but it would take a wizard to decipher some of the corporate-speak that is used to avoid the term "layoffs."

"I think layoff is one of those terms that has come to be associated with a company in trouble," says John Malmo, president of Koenig Marketing Consulting. "The whole issue of adding and subtracting jobs has become such an important factor in the way customers, employees, and shareholders react to it that companies have gotten very sophisticated about how they handle the news. They've developed a whole new lexicon."

Sometimes it serves a company's purposes to look big. Politicians and the Memphis Area Chamber of Commerce like to use big happy numbers because it makes the city (and them) look good.

The chamber's 2000 Growth Report says the Memphis area added 12,259 jobs through either expansion or relocation. Spokesman Allen Hester says the chamber reports new jobs "when they are announced" even though the jobs may be phased in over a period of years.

Further incentive: boards that give out tax credits, like the Industrial Development Board, base the amount of their largesse on the number and pay of the jobs that the company will create.

Wang's International, for instance, is listed in the most recent chamber of commerce data as having 1,000 employees. News stories put the maximum number of employees at 800. At any rate, it's a moot point. The Memphis-headquartered company recently took bankruptcy and the actual number of workers is closer to zero.

At least in that case there was no doubt that jobs were being eliminated. The same can be said for Bartlett-based Brother Industries, which laid off 227 employees and shut its typewriter plant; Cigna, a health care company which went out of business and cut 176 jobs; and computer manufacturer and distributor Ingram Micro, which sliced 140 jobs.

In those cases, the news was so unequivocally bad that there was no hiding the facts. The harder trick is trying to figure out the numbers at big corporations like FedEx, AutoZone, and International Paper. Those companies walk a fine line between balancing corporate morale and pleasing Wall Street.

"Frequently it is good stock news when you read about a company that has cut its workforce by 10 percent or consolidates operations," says Malmo. "It is not at all unlikely that Wall Street will react favorably to it."

Last week The Wall Street Journal reported that FedEx "plans to trim its labor force by at least five percent, or more than 9,000 jobs." The company took exception to that. Spokesman Jesse Bunn says the reporter apparently extrapolated incorrectly from some numbers the company had provided.

The correct number, Bunn says, is 4,000 full-time equivalent positions, and those reductions will be achieved through "very stringent cost-control measures" including a hiring freeze.

"We have reduced full-time equivalents but it hasn't been through layoffs," Bunn says.

FedEx, of course, employs thousands of part-time employees among what the chamber reports as a 40,000-person local workforce, so the actual number of people who used to work at FedEx but don't work there any more or don't work there as much as they used to is hard to figure.

"The only number we gave out was over 4,000," says Bunn.

For what it's worth, the stock rose a couple points last week despite a 54 percent decline in earnings.

AutoZone has also been in the news for reducing its number of stores nationwide by 30 to 60 and cutting some local employees. The most widely reported number was 50.

"There's really not any big news," says Emma Jo Kauffman, head of investor relations. "We restructured the way we do things."

Some AutoZoners who were offered new jobs elected not to take them, she says, adding that the fact that some of the jobs that were "restructured" were in communications may have helped spread the news. Or non-news.

Elsewhere in corporate Memphis, International Paper first announced a major expansion of 950 jobs and construction of a new office tower in Memphis to great acclaim. But several months later it announced it was cutting 300 jobs at its Memphis headquarters as part of a 10 percent reduction in its U.S. workforce.

Contacted by this reporter, a company spokesman first sought clarification from two other IP employees, neither of whom was available. A third contact was still seeking the information at press time.

It is little wonder that the media sometimes seem confused about layoffs. At The Commercial Appeal, there have been rumors of layoffs in the news department but television reporter Les Smith and others trying to check them out have been rebuffed. The shrinking product and proliferation of wire-service copy speak loudly enough.

For the record, The Memphis Flyer never lays off or fires anyone but does exercise rigorous cost controls, restructures when the mood strikes, and is proud to be a player in the bustling Memphis economy.

You can e-mail John Branston at

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