Jan 31 (Reuters) – Intel Corp (INTC.O) said on Tuesday that it had made broad cuts to employee and executive pay, a week after the company issued a lower-than-expected sales forecast driven by a loss of market share to rivals and a PC market downturn.
The reductions will range from 5% of base pay for mid-level employees to as much as 25% for Chief Executive Pat Gelsinger, while the company’s hourly workforce’s pay will not be cut, said a person familiar with the matter who was not authorized to speak publicly.
Intel spokesperson Addy Burr said in a statement that the “changes are designed to impact our executive population more significantly and will help support the investments and overall workforce.”
Intel last week said its profit margins were plunging as the PC market cools after several years of growth during the pandemic.
Gelsinger also conceded that Intel has “stumbled” and lost market share to rivals such as Advanced Micro Devices Inc (AMD.O), which on Tuesday reported quarterly sales that were above Wall Street’s expectations.
Latest Updates
View 2 more stories
The person familiar with Intel’s pay cuts said that in addition to 5% decreases for mid-level employees, vice president level employees will see 10% reductions and the company’s top executives other than the CEO will get 15% cuts.
The company has also lowered its 401(k) matching program from 5% to 2.5% and suspended merit raises and quarterly performance bonuses, the person said.
Annual performance bonuses based Intel’s overall financial performance will remain but those bonuses have been smaller in recent years as the company has lost ground to rivals, the person added.
Reporting by Stephen Nellis in San Francisco; Editing by Christopher Cushing and Jamie Freed
Our Standards: The Thomson Reuters Trust Principles.
Schools, transport networks, refinery deliveries hit
Macron: Reform vital to ensure viability of pension system
SAINT-NAZAIRE, France, Jan 31 (Reuters) – Striking workers disrupted French refinery deliveries, public transport and schools on Tuesday in a second day of nationwide protests over President Emmanuel Macron’s plan to make people work longer before retirement.
Crowds marched through cities across France to denounce a reform that raises the retirement age by two years to 64 and which is a test of Macron’s ability to push through change now that he has lost his working majority in parliament.
On the rail networks, only one in every three high-speed TGV trains were operating and even fewer local and regional trains. Services on the Paris metro were thrown into disarray.
Buoyed by their success earlier in the month when more than a million people took to the streets, trade unions which have been battling to maintain their power and influence urged the public to turnout en masse.
“We won’t drive until we’re 64!” bus driver Isabelle Texier said at a protest in Saint-Nazaire on the Atlantic coast, adding that many careers involved tough working conditions.
Others felt resigned ahead of likely bargaining between Macron’s ruling alliance and conservative opponents who are more open to pension reform than the left.
“There’s no point in going on strike. This bill will be adopted in any case,” said 34-year-old Matthieu Jacquot, who works in the luxury sector.
Unions said half of primary school teachers had walked off the job. TotalEnergies (TTEF.PA) said 55% of its workers on morning shifts at its refineries had downed tools, a lower number than on Jan. 19. The hard-left CGT union said the figure was inaccurate.
For unions, the challenge will be maintaining a strike movement at a time when high inflation is eroding salaries.
At a local level, some announced “Robin Hood” operations unauthorised by the government. In the southwestern Lot-et-Garonne area, the local CGT trade union branch cut power to several speed cameras and disabled smart power meters.
“When there is such a massive opposition, it would be dangerous for the government not to listen,” said Mylene Jacquot, secretary general of the CFDT union’s civil servants branch.
[1/16] Protesters attend a demonstration against French government’s pension reform plan in Paris as part of a day of national strike and protests in France, January 31, 2023. REUTERS/Gonzalo Fuentes
Opinion polls show a substantial majority of the French oppose the reform, but Macron intends to stand his ground. The reform was “vital” to ensure the viability of the pension system, he said on Monday.
A street march in Paris takes place later in the day.
‘BRUTAL’
The pension system reform would yield an additional 17.7 billion euros ($19.18 billion) in annual pension contributions, according to Labour Ministry estimates.
Unions say there are other ways to raise revenue, such as taxing the super rich or asking employers or well-off pensioners to contribute more.
“This reform is unfair and brutal,” said Luc Farre, the secretary general of the civil servants’ UNSA union. “Moving (the pension age) to 64 is going backwards, socially.”
French power supply was down by 4.5% or 3 gigawatts (GW), as workers at nuclear reactors and thermal plants joined the strike, data from utility group EDF (EDF.PA) showed.
TotalEnergies said deliveries of petroleum products from its French sites had been halted because of the strike, but that customers’ needs were met.
The government made some concessions while drafting the legislation. Macron had originally wanted the retirement age to be set at 65, while the government is also promising a minimum pension of 1,200 euros a month.
Prime Minister Elisabeth Borne has said the 64 threshold is “non-negotiable”, but the government is exploring ways to offset some of the impact, particularly on women.
Hard-left opposition figure Jean-Luc Melenchon, a vocal critic of the reform, said parliament would on Monday debate a motion calling for a referendum on the matter.
“The French are not stupid,” he said at a march in Marseille. “If this reform is vital, it should be possible to convince the people.”
Reporting by Forrest Crellin, Benjamin Mallet, Sudip Kar-Gupta, Leigh Thomas, Blandine Henault, Michel Rose, Dominique Vidalon, Benoit Van Overstraeten; Writing by Ingrid Melander and Richard Lough; Editing by Janet Lawrence
Our Standards: The Thomson Reuters Trust Principles.
Jan 23 (Reuters) – Spotify Technology SA (SPOT.N) said on Monday it plans to cut 6% of its workforce and would take a related charge of up to nearly $50 million, adding to the massive layoffs in the technology sector in preparation for a possible recession.
The tech industry is facing a demand downturn after two years of pandemic-powered growth during which it had hired aggressively. That has led firms from Meta Platforms Inc (META.O) to Microsoft Corp (MSFT.O) to shed thousands of jobs.
“Over the last few months we’ve made a considerable effort to rein in costs, but it simply hasn’t been enough,” Chief Executive Daniel Elk said in a blog post announcing the roughly 600 job cuts.
“I was too ambitious in investing ahead of our revenue growth,” he added, echoing a sentiment voiced by other tech bosses in recent months.
Spotify’s operating expenditure grew at twice the speed of its revenue last year as the audio-streaming company aggressively poured money into its podcast business, which is more attractive for advertisers due to higher engagement levels.
Reuters Graphics
At the same time, businesses pulled back on ad spending on the platform, mirroring a trend seen at Meta and Google parent Alphabet Inc (GOOGL.O), as rapid interest rate hikes and the fallout from the Russia-Ukraine war pressured the economy.
The company, whose shares rose 5.8% to $103.55, is now restructuring itself in a bid to cut costs and adjust to the deteriorating economic picture.
It said Dawn Ostroff, the head of content and advertising, was leaving after an over four-year stint at the company. Ostroff helped shape Spotify’s podcast business and guided it through backlash around Joe Rogan’s show for allegedly spreading misinformation about COVID-19.
The company said it is appointing Alex Norström, head of the freemium business, and research and development boss Gustav Söderström as co-presidents.
Spotify had about 9,800 full-time employees as of Sept. 30.
($1 = 0.9196 euros)
Reporting by Eva Mathews in Bengaluru; Editing by Sherry Jacob-Phillips and Shailesh Kuber
Our Standards: The Thomson Reuters Trust Principles.
Jan 20 (Reuters) – Google’s parent Alphabet Inc (GOOGL.O) is eliminating about 12,000 jobs, or 6% of its workforce, the company said Friday, in the latest cuts to shake the technology sector.
Sundar Pichai, Alphabet’s CEO, said in a staff memo shared with Reuters that the company had rapidly expanded headcount in recent years “for a different economic reality than the one we face today.”
“I take full responsibility for the decisions that led us here,” he said.
The cuts come days after rival Microsoft Corp (MSFT.O) said it would lay off 10,000 workers.
Alphabet’s job losses affect teams across the company including recruiting and some corporate functions, as well as some engineering and products teams.
The layoffs are global and impact U.S. staff immediately.
Alphabet has already emailed affected employees, the memo said, while the process will take longer in other countries due to local employment laws and practices.
The news comes during a period of economic uncertainty as well as technological promise, in which Google and Microsoft have been investing in a burgeoning area of software known as generative artificial intelligence.
“I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI,” Pichai said in the note.
Reuters was first to report the news.
Reporting by Jeffrey Dastin in Davos, Switzerland; Editing by Elaine Hardcastle and Alexander Smith
Our Standards: The Thomson Reuters Trust Principles.
Jan 18 (Reuters) – Amazon.com Inc (AMZN.O) will cut some jobs in the United States, Canada and Costa Rica by the end of Wednesday as part of its plan to lay off 18,000 employees, the e-commerce giant said in a memo to staff seen by Reuters.
The layoffs are the latest in the U.S. technology sector, with companies cutting their bloated workforce and slashing costs to reverse pandemic-era excesses and prepare for a worsening global economy.
The company is terminating 2,300 employees in Seattle and Bellevue, according to an update on the Worker Adjustment and Retraining Notification (WARN) site. The U.S. labor law requires companies planning a mass layoff to inform employees 60 days before the closure.
Amazon.com Chief Executive Andy Jassy said earlier this month the cuts, about 6% of the company’s roughly 300,000 corporate employees, would mostly impact the e-commerce and human resources divisions. read more
Microsoft (MSFT.O) said earlier on Wednesday it would cut about 10,000 jobs and take a $1.2-billion charge. read more
Reporting by Tiyashi Datta, Eva Mathews and Maria Ponnezhath in Bengaluru; Editing by Krishna Chandra Eluri, Shinjini Ganguli, and Uttaresh.V
Our Standards: The Thomson Reuters Trust Principles.
63% worried about ECB’s ability to protect purchasing power
FRANKFURT, Jan 18 (Reuters) – (This Jan. 17 story has been corrected to restore the dropped words in paragraph 11)
European Central Bank staff are losing confidence in the institution’s leadership following the ECB’s failure to control inflation and a pay award that lagged the leap in prices, according to a survey by trade union IPSO.
The responses underline that even central banks, whose primary responsibility is fighting inflation, are not immune to staff dissatisfaction with the sharply rising cost of living.
The survey was organised in the context of a dispute between IPSO, which holds six out of nine seats on the ECB’s staff committee, and the central bank’s board over pay and remote-working arrangements.
An ECB spokesperson did not comment directly on IPSO’s findings when asked but pointed to a separate staff survey, run by the ECB itself last year, showing that 83% of nearly 3,000 respondents were proud to work for the ECB and 72% would recommend it.
Results of IPSO’s survey, which largely focused on pay and remote-working arrangements but also included questions about trust in the board, were sent to ECB staff on Tuesday in an email, seen by Reuters.
They showed two-thirds of roughly 1,600 respondents said their trust in Lagarde and the rest of the six-member ECB board had been damaged by recent developments such as high inflation and a pay increase that did not match the rise in prices.
Asked how much trust they had in Lagarde and the board when it comes to leading and managing the ECB, the central bank for the 20 countries that use the euro, just under half of respondents said “moderate” (34.3%) or “high” (14.6%).
But over 40% of respondents said they had “low” (28.6%) or “no” (12%) trust, while 10.5% could not say.
“This is a serious concern for our institution, as no one can correctly lead an organisation without the trust of its workforce,” the union said in its email.
INFLATION SURGE, PAY BATTLES
The survey was the first by IPSO to ask about trust in top management since Christine Lagarde took over as ECB President in late 2019.
A similar IPSO survey of ECB staff, taken just before her predecessor Mario Draghi stepped down, showed 54.5% of 735 respondents rated his presidency “very good” or “outstanding”, with support for his policy measures even higher.
Then, however, inflation in the euro zone had been low for a decade. Its recent surge to multi-decade highs in countries around the world has seen a revival in battles over pay between workers and the companies and institutions that employ them.
And a majority of respondents in the October 2019 survey also complained about a lack of transparency in recruitment and perceived favouritism under Draghi.
The most recent Bank of England staff survey, also conducted in 2019, showed 64% of respondents had “trust and confidence in the Bank’s leadership”.
A 2022 U.S. government survey of employees at departments and federal agencies found that 61% of respondents had “a high level of respect” for their organisation’s senior leaders – roughly stable compared to the previous two years.
The ECB spokesperson also pointed to internal surveys in 2020-21 that found roughly 80% of respondents were satisfied with health-and-safety measures taken by the ECB in response to the coronavirus pandemic.
The latest IPSO survey showed 63% of staff who responded were worried about the ECB’s ability to protect their purchasing power after being handed a pay increase of just 4% last year – or roughly half the rise in consumer prices.
The ECB has been criticised by politicians, bankers and academics for initially underestimating a surge in the cost of living and then making up for it with large and painful increases in borrowing costs.
Lagarde, who is not an economist and had not been a central banker before joining the ECB, colourfully defended her board at an event with staff last month.
“If it wasn’t for them I’d be a sad, lonely cowgirl lost somewhere in the Pampa of monetary policy,” Lagarde said, according to a recording of the Dec. 19 town hall seen by Reuters.
She and fellow board members have long worried about the risk of a potential “wage-price spiral”, where higher salaries feed into prices, which they argue would make it harder for the ECB to bring inflation back down to its 2% target.
But IPSO said that concern is misplaced and workers should not be made to bear the brunt of the current bout in inflation.
“The ECB might be preaching lower real wages, but this is not our stance as your staff union,” it wrote in its message to ECB employees.
Editing by Catherine Evans
Our Standards: The Thomson Reuters Trust Principles.
Mass redundancies, spending review beckons for Wall Street giant
Cuts to all major divisions expected, globally
Restructuring in Asian wealth unit kicks off Wednesday’s layoffs
NEW YORK/LONDON/HONG KONG, Jan 12 (Reuters) – Goldman Sachs (GS.N) began laying off staff on Wednesday in a sweeping cost-cutting drive, with around a third of those affected coming from the investment banking and global markets division, a source familiar with the matter said.
The long-expected jobs cull at the Wall Street titan is expected to represent the biggest contraction in headcount since the financial crisis. It is likely to affect most of the bank’s major divisions, with its investment banking arm facing the deepest cuts, a source told Reuters this month.
Just over 3,000 employees will be let go, the source, who could not be named, said on Monday. A separate source confirmed on Wednesday that cuts had started.
“We know this is a difficult time for people leaving the firm,” a Goldman Sachs statement on Wednesday said.
“We’re grateful for all our people’s contributions, and we’re providing support to ease their transitions. Our focus now is to appropriately size the firm for the opportunities ahead of us in a challenging macroeconomic environment.”
The cuts are part of broader reductions across the banking industry as a possible global recession looms. At least 5,000 people are in the process of being cut from various banks. In addition to the 3,000 from Goldman, Morgan Stanley (MS.N) has cut about 2% of its workforce, or 1,600 people, a source said last month while HSBC (HSBA.L) is shedding at least 200, sources previously said.
Last year was challenging across groups including credit, equities, and investment banking broadly, said Paul Sorbera, president of Wall Street recruitment firm Alliance Consulting. “Many didn’t make budgets.”
“It’s just part of Wall Street,” Sorbera said. “We’re used to seeing layoffs.”
The latest cuts will reduce about 6% of Goldman’s headcount, which stood at 49,100 at the end of the third quarter.
[1/3] A trader works at the Goldman Sachs stall on the floor of the New York Stock Exchange, April 16, 2012. REUTERS/Brendan McDermid/File Photo
The firm’s headcount had added more than 10,000 jobs since the coronavirus pandemic as markets boomed.
The reductions come as U.S. banking giants are forecast to report lower profits this week. Goldman Sachs is expected to report a net profit of $2.16 billion in the fourth-quarter, according to a mean forecast by analysts on Refinitiv Eikon, down 45% from $3.94 billion net profit in the same period a year earlier.
Shares of Goldman Sachs have partially recovered from a 10% fall last year. The stock closed up 1.99% on Wednesday, up around 6% year-to-date.
LAYOFFS AROUND GLOBE
Goldman’s layoffs began in Asia on Wednesday, where Goldman completed cutting back its private wealth management business and let go of 16 private banking staff across its Hong Kong, Singapore and China offices, a source with knowledge of the matter said.
About eight staff were also laid off in Goldman’s research department in Hong Kong, the source added, with layoffs ongoing in the investment banking and other divisions.
At Goldman’s central London hub, rainfall lessened the prospect of staff huddles. Several security personnel actively patrolled the building’s entrance, but few people were entering or leaving the property. A glimpse into the bank’s recreational area just beyond its lobby showed a handful of staffers in deep conversation but few signs of drama. Wine bars and eateries local to the office were also short of post-lunch trade, in stark contrast to large-scale layoffs of the past when unlucky staffers would typically gather to console one another and plan their next career moves.
In New York, employees were seen streaming into headquarters during the morning rush.
Goldman’s redundancy plans will be followed by a broader spending review of corporate travel and expenses, the Financial Times reported on Wednesday, as the U.S. bank counts the costs of a massive slowdown in corporate dealmaking and a slump in capital markets activity since the war in Ukraine.
The company is also cutting its annual bonus payments this year to reflect depressed market conditions, with payouts expected to fall about 40%.
Reporting by Sinead Cruise and Iain Withers in London, Selena Li in Hong Kong, Scott Murdoch in Sydney and Saeed Azhar in New York; Editing by Josie Kao and Christopher Cushing
Our Standards: The Thomson Reuters Trust Principles.
Jan 11 (Reuters) – U.S. clean energy companies are offering better wages and benefits, flying in trainers from overseas, and contemplating ideas like buying roofing and electric repair shops just to hire their workers as firms try to overcome a labor shortage that threatens to derail President Joe Biden’s climate change agenda.
The Inflation Reduction Act, signed into law last year, provides for an estimated $370 billion in solar, wind and electric vehicle subsidies, according to the White House. Starting Jan. 1, American consumers can take advantage of those tax credits to upgrade home heating systems or put solar panels on their roofs. Those investments will create nearly 537,000 jobs a year for a decade, according to an analysis by BW Research commissioned by The Nature Conservancy.
Reuters Graphics Reuters Graphics
But with the U.S. unemployment rate at an historic low of 3.5%, companies say they fear they will struggle to fill those jobs, and that plans to transition away from fossil fuels could stall out. Despite layoff announcements and signs of a slowdown elsewhere in the economy, the labor market for clean energy jobs remains tight.
“It feels like a big risk for this expansion. Where are we going to find all the people?” said Abigail Ross Hopper, president of the Solar Energy Industries Association trade group.
The shortage is anticipated to hit especially hard in electric vehicle and battery production and solar panel and home efficiency installations, forcing some of the companies into bold new approaches to find workers.
Korea’s SK Innovation Co Ltd, which makes batteries for Ford Motor Co’s (F.N) F-150 Lightning all-electric pickup truck in Commerce, Georgia, has pumped up pay and benefits as it ramps up its U.S. workforce to 20,000 people by 2025 from 4,000 today.
The battery maker is advertising pay between $20 and $34 an hour, above Georgia’s median hourly wage of $18.43, according to the U.S. Bureau of Labor Statistics. It is also covering 100% life insurance costs and matching retirement plan contributions up to 6.5%, above the national average of 5.6%, according to the Plan Sponsor Council of America. And the company is providing free food on the job.
“Georgia’s talent pool is not really massive. But we are trying to improve some of our policies to better source and retain workers,” said an SK official who declined to be named, citing the sensitivity of the matter.
Georgia state officials said SK’s hiring has been a success considering how quickly production had to ramp up to meet the company’s obligations to automakers.
While national residential solar installer SunPower Corp (SPWR.O) is recruiting aggressively, Chief Executive Peter Faricy said the company is also looking at what he called “crazy ideas” to secure labor – including buying up companies just for their workers.
“I’m not suggesting we will do this, but I want to give you an order of magnitude of what we’re considering. Like, should we acquire a roofing company and make them all solar installers? Do we go buy an electrical company and acquire 100 electricians?” he said.
SunPower also held talks within the last year with panel manufacturer First Solar Inc (FSLR.O) about developing a solar panel that would be easier to install, enabling crews to outfit two homes a day instead of just one, Faricy said.
SunPower’s competitor, Sunrun Inc (RUN.O), is deploying drones to survey roofs ahead of installation, reducing the number of workers required to scale roofs. It is also rewarding top crews with office parties.
“As best you can game-ify the experience for the employee… it just makes the industry more fun, more attractive,” Chris McClellan, Sunrun’s senior vice president of operations, said in an interview.
Offshore wind developer Orsted (ORSTED.CO), a Danish company that is planning to build projects off the East Coast, hopes to fly in employees from projects in the United Kingdom and Asia to help train staff. State reports have indicated that New York and Massachusetts face large offshore wind workforce gaps.
“We’re creating sort of an ecosystem where we don’t just have an offshore wind academy, but really train the trainers of the future,” said Mads Nipper, Orsted’s CEO, told Reuters.
The Biden Administration has repeatedly promised that new green energy jobs would be well-paying union jobs.
But many of those jobs have lagged the fossil fuel industry in pay, according to a 2021 study by BW Research, as clean energy companies have sought to contain costs to compete with entrenched industries. The IRA seeks to address that by tying prevailing wage and apprenticeship requirements to the subsidies.
Those provisions — and the hiring challenges — have put pressure on some employers to use unionized labor.
Learning from its earlier hiring challenges in Europe and Asia, Orsted signed an agreement with North America’s Building Trades Unions to secure workers.
Even Amazon.com Inc (AMZN.O), a company that has been embroiled in disputes with workers trying to organize, has used union labor to build the electric charging infrastructure for its fleet of electric delivery vehicles in Maspeth, Queens, NY.
Amazon did not respond to requests for comment.
Corrine Case, an electrician represented by the International Brotherhood of Electrical Workers, said she was paid $43 an hour to install the charging system at Amazon.
A single mother, Case said she was excited about the job security offered by the rising demand for electricians to install charging stations.
“Our field is constantly changing because of new energy sources and to be a part of that is amazing,” she said.
FREE WORKER TRAINING
In their hunt for workers, solar, wind and electric vehicle companies have expanded programs offering free and subsidized training to military veterans, women and the formerly incarcerated.
SK told Reuters that it has been recruiting at military job fairs and American Legion chapters and collaborating with programs like the Georgia National Guard’s Work for Warriors and the Manufacturing Institute’s Heroes MAKE America.
Some solar companies have tried to recruit veterans, saying the skills learned in military life translate well to the industry.
Utility scale solar developer SOLV Energy, SunPower and Nextracker last year teamed up with nonprofit Solar Energy International to fund a women-only training program for solar installers. More than 30 women attended the week-long course in Colorado.
In October, the nonprofit Solar Hands-On Instructional Network of Excellence (SHINE) teamed up with the Virginia Department of Corrections on a pilot program to train 30 prison inmates and recently incarcerated people in solar panel installation. SHINE’s director David Peterson said the group is discussing expanding the program.
In California, the nonprofit Grid Alternatives has trained 150 inmates at the Madera County jail in solar installation since 2017 and is expanding its program this year to other facilities in the state. Potential employers are more open to hiring the formerly incarcerated once they see they have received some training, Tom Esqueda, the nonprofit’s outreach manager, said.
In Los Angeles, nonprofit Homeboy Industries, which works to rehabilitate former gang members, is using the potential job opportunities for solar panel installers to help recruits for its state-funded jobs program. Homeboy trains 50-60 people a year as solar panel installers.
More than 80% of the people who have gone through the training in the last year have found jobs in solar, according to Jackie Harper, who oversees the program.
“I’m going to be sticking with this,” said Marco Reyes, 28, who went through the program after his release from prison in February and earns $23 an hour as an installer in Valencia, California.
He now plans to train in the electrical end of solar installation, which would bump up his pay.
“Everyone has a chance to move up the ladder into a better position,” he said. “This job to me is a life changer.”
Read more:
Korea’s Hanwha Qcells to invest $2.5 bln in U.S. solar supply chain
U.S. solar installations to fall 23% this year due to China goods ban -report
Reporting by Nichola Groom and Valerie Volcovici; Edited by Richard Valdmanis and Suzanne Goldenberg
Our Standards: The Thomson Reuters Trust Principles.
PARIS, Jan 10 (Reuters) – The French should work two years longer to age 64 before retiring, the government said on Tuesday, announcing an unpopular pension system overhaul that immediately prompted unions to call for strikes and protests.
The right to retire at a relatively young age is deeply cherished in France and the reform will be a major test of President Emmanuel Macron’s ability to deliver change as social discontent mounts over the cost of living.
The reform’s passage through parliament will not be easy. Macron’s government says it is vital to keep the pension budget out of the red. Unions argue the reform is unfair and unnecessary.
“Nothing justifies such a brutal reform,” Laurent Berger, leader of the moderate, reform-minded CFDT union, told reporters after trade union leaders agreed on a nationwide strike for Jan. 19, which will kick off a series of strikes and protests.
An Odoxa poll showed four out of five citizens oppose the higher retirement age.
“I’m well aware that changing our pension system raises questions and fears among the French,” Prime Minister Elisabeth Borne had told a news conference shortly before.
“We offer today a project to balance our pension system, a project that is fair,” she said, adding that France had to face reality.
Overhauling the pension system was a central pillar of Macron’s reformist agenda when he entered the Elysee Palace in 2017. But he shelved his first attempt in 2020 as the government battled to contain COVID-19.
The second attempt will not be any easier.
“It’s one slap in the face after another,” said 56-year-old Frederic Perdriel during a small protest in the western city of Rennes ahead of Borne’s announcement. “There are other ways to finance pensions than raising the retirement age.”
“BRUTAL, CRUEL”
Macron and Borne will need to win support among conservative Les Republicains (LR) lawmakers in the coming months to pass the reform in parliament.
That looks less challenging than it did a few weeks ago after concessions on the retirement age – Macron had originally wanted it to be 65 – and a minimum pension.
Olivier Marleix, who leads the LR group in the lower house of parliament, reacted positively to Borne’s announcements.
“They heard us,” he said, while asking for more efforts to ensure employment for people close to retirement age.
Even so, LR is divided on the issue, so every vote counts.
The Socialists, the hard-left La France Insoumise (France Unbowed) and the far-right’s National Rally were swift to denounce the reform. Left-wing lawmaker Mathilde Panot branded the plan “archaic, unfair, brutal, cruel.”
“The French can count on our determination to block this unfair reform,” the far-right’s Marine Le Pen said.
Under the government plan, the retirement age will be raised by three months per year from September, reaching the target age of 64 in 2030.
From 2027, eight years earlier than planned in past reforms, it will be necessary to have worked 43 years to receive a full pension.
Other measures aim to boost the employment rate among 60 to 64-year-olds, which is one of the lowest among leading industrialised nations.
With one of the lowest retirement ages in the industrialised world, France also spends more than most countries on pensions at nearly 14% of economic output, according to the Organisation for Economic Cooperation and Development.
Reporting by Elizabeth Pineau, Leigh Thomas, Stephane Mahe, Tassilo Hummel, Blandine Henault; writing by Ingrid Melander; editing by Richard Lough, Alexandra Hudson and Josie Kao
Our Standards: The Thomson Reuters Trust Principles.
Echoes of dotcom crash that fueled Facebook, others
Jan 3 (Reuters) – Nic Szerman lost his job at Meta Platforms (META.O) in November, just two months after joining full-time, falling victim to a sweeping 13% reduction of its workforce as the advertising market cratered.
Days later he was back working, seeking investment for his own company Nulink, a blockchain-based payment company, and sent pitches to startup accelerator Y Combinator and Andreessen Horowitz’s cryptocurrency fund.
“As counterintuitive as it may sound, this layoff left me in a really good position,” the 24-year-old said. “Because I don’t have to pay back the sign-on bonus, I get four months of pay, and now I have time to focus on my own project.”
Szerman is part of a wave of would-be entrepreneurs who are emerging from the ashes of the mass job losses seen in Silicon Valley in the second half of 2022, according to venture capitalists.
U.S. tech giants including Meta, Microsoft (MSFT.O), Twitter and Snap (SNAP.N) have purged more than 150,000 staff, according to Layoff.fyi, which tracks technology job losses.
While overall venture capital (VC) financing fell 33% globally to about $483 billion in 2022, early-stage funding was robust, with $37.4 billion raised in so-called angel or seed rounds, in line with the record level seen in 2021, according to data from research firm PitchBook.
Day One Ventures, an early stage venture fund in San Francisco, launched a new initiative in November to fund startups founded by people who had been laid off from their tech jobs, touting the slogan “Funded, not Fired”.
The program aims to cut 20 checks for $100,000 by the end of 2022. Day One said it had received over 1,000 applications, most of them from people who were cut loose by Meta, Stripe and Twitter.
“We’re investing $2 million in 20 companies – if we just find one unicorn it almost returns the fund, which I think is a really unique opportunity for us as fund managers,” said Masha Bucher, co-founder at Day One Ventures.
“Looking at the last economic cycle, companies like Stripe, Airbnb, Dropbox have been created in crisis.”
HOT: GAMING AND AI
Also in November, multi-stage fund Index Ventures, which has bankrolled Facebook, Etsy and Skype, launched its second Origins fund, which will invest $300 million in early-stage startups.
Silicon Valley investor U.S. Venture Partners and Austrian VC firm Speedinvest have meanwhile earmarked a similar amount for newly founded companies.
Investors highlighted gaming and artificial intelligence among hot areas of interest.
“With advances in game design, new innovations like cloud gaming, and the emergence of social networking in this sphere, gaming has really transcended into mainstream culture,” said Sofia Dolfe, partner at Index Ventures.
“In every period of economic uncertainty, there is opportunity – to reset, re-prioritize and re-focus energy and resources.”
DOTCOM BUBBLE 2.0
Szerman said his project was rejected by Y Combinator, while he hasn’t heard back from Andreessen Horowitz yet, though he added that other early-stage venture capitalists had expressed interest.
“I told the investors we’ll chat in two or three months,” he added. “I’ll focus on scaling the system now.”
Some investors compared the 2022 downturn to the dotcom crash of the early 2000s, when dozens of overvalued startups went bust, flooding the market with talent and helping to spark a wave of new companies such as Facebook and YouTube.
“Many great companies have been created in relatively dark times,” said Harry Nelis, partner at investment firm Accel, who sees a new generation of risk takers emerge among the swathe of people left unemployed.
Some industry players say former Big Tech employees are uniquely placed to start their own companies, having seen first-hand how some of the biggest firms in the world operate, and enjoying ongoing access to their network of highly skilled colleagues.
One former Googler has sought to help others like him looking for life after technology giants. In 2015, Christopher Fong, who spent almost a decade working for the tech titan in California, launched Xoogler, a project designed to help former employees hoping to start their own companies. Since then, the group’s membership has since swelled to more than 11,000.
Fong told Reuters that experience in Big Tech firm gave founders a “strong brand that can be leveraged to meet investors, potential customers, and recruit team members”.
(This story has been refiled to correct Harry Nelis’ designation to partner from managing partner in paragraph 19)
Reporting by Martin Coulter in London, Supantha Mukherjee in Stockholm and Krystal Hu in New York; Editing by Pravin Char
Our Standards: The Thomson Reuters Trust Principles.