The Atlanta-based logistics company is one of Louisville’s largest employers, but it’s not known yet how planned cuts would affect local UPS jobs.
CEO Carol Tomé said UPS employs nearly 500,000 people globally, and that the layoffs are meant to impact full- and part-time management workers, who make up about 85,000 employees. The cuts would also include some contractors.
She said 2023 was a “difficult and disappointing” year, with UPS reporting drops in package volume, revenue and operating profits compared to 2022. UPS spokesperson Laura Holmberg said in an email that annual revenue last year dropped by more than $9 billion compared to 2022.
The plan to eliminate thousands of workers could reduce the company’s costs by about $1 billion.
“We are going to fit our organization to our strategy, and align our resources against what’s wildly important,” Tomé said about the layoffs.
UPS also reported Tuesday that it returned $7.6 billion in dividends and share buybacks to shareholders in 2023.
How the layoffs will affect workers in Louisville is unclear.
UPS spokesperson Laura Holmberg said in an email that at the end of 2023, the company employed around 31,000 UPS workers in Kentucky. Nearly 25,000 of them worked in Louisville, including at UPS Worldport, the shipping giant’s largest air cargo hub.
But Holmberg said she didn’t have data on the number of management workers in Kentucky and Louisville.
Brian Newman, the company’s chief financial officer, said on the earnings call that the company expects to complete about three-quarters of the job cuts in the first half of 2024.
“As volume returns to the system, we don’t expect these jobs to come back,” Newman said.
The International Brotherhood of Teamsters represents more than 340,000 UPS workers and recently negotiated a new five-year contract with the company, following the threat of a massive strike over pay and working conditions.
Although the new contract included a jump in union wage rates starting last August, company officials said they cut operating expenses in the last quarter of 2023. That was in part due to lower fuel costs and transportation purchases.
Holmberg and Teamsters spokesperson Kara Deniz said the job cuts announced Tuesday would not affect union workers.
Late last year, UPS announced it would lay off workers at Louisville’s Centennial Ground Hub in February.
