You read and hear about job losses occurring when companies pick up and move to a new location (or a new country in some cases). They get a lot of publicity, particularly in the area where the job losses occur. You also read and hear about companies filing bankruptcy and reorganizing with a leaner workforce. What you don’t hear as much is when there is an acquisition such as this one involving AB InBev and SAB-Miller.
The size of this company may make it seem distant to some, but it is not to those who are about to get the ax, pink slip or “the meeting.” In this case, it is estimated to be 3% of the workforce, or around 6,600 jobs. It may be more, according to the August 26 Washington Post article “Brewer AB InBev To Cut Thousands of Jobs in Takeover Deal.”
These are jobs that are perfectly legitimate one day and gone the next. I don’t know what’s worse, to have your job eliminated or to simply have you replaced by someone making a lower salary. I have read articles where the replaced worker ends up having to train his/her replacement. Either way jobs are gone not by a general economic slowdown but by manipulative tactics to simply corner the market and reward executive compensation.
The eliminated salaries are used by large companies after an acquisition to help pay for it. But top executives don’t lose their jobs, or if one does it is usually accompanied by a compensation package that does not have them worrying about how they are going to pay next month’s bills.
This acquisition is not going to stimulate new products or R&D. It is not going to create competition but stifle it. The Obama administration should have done more to fight this. This last point will be the subject of a future post.