UPS Cuts 12,000 Jobs Post-Revenue Dip and Strike Deal
United Parcel Service (UPS) is set to reduce its global workforce by around 12,000 jobs, representing approximately 2% of its employees. The move primarily targets full- and part-time management positions as well as contract roles. UPS CEO Carol Tome indicated that these layoffs, expected to result in about $1 billion in cost savings, are part of a broader strategy to improve operational efficiency with the aid of artificial intelligence and other technologies.
The decision was made in the wake of a recently forged agreement with the International Brotherhood of Teamsters, which prevented a potential strike and was supported by the union's members. The ratified five-year contract included significant wage increases for current employees.
In its fiscal year 2023, UPS reported a decrease in consolidated revenue by 9.3% to about $91 billion, with adjusted operating profits falling by 28.7% from the previous year. The company is also considering the sale of its Coyote truckload brokerage business. To support the transition, UPS has committed to offering severance packages and outplacement assistance to all affected employees.
