Thursday, October 30, 2008

American Express to cut 7,000 jobs

NEW YORK - American Express says it will cut 7,000 jobs, or about 10 percent of its work force, as part of an effort to slash costs by $1.8 billion in 2009.

The New York-based credit card issuer says it is also suspending management level salary increases next year and instituting a hiring freeze.

It plans to scale back investments in technology, marketing and business development and streamline costs tied to some rewards programs. It also expects to cut expenses for consulting and other professional services.

As a result, the company expects to take a restructuring charge of $240 million to $290 million in the fourth quarter.

American Express earlier this month reported a 24 percent drop in third-quarter profit as cardholders restrained their spending.

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