J&J to axe more than 7,000 jobs in restructuring

Johnson & Johnson (J&J), the world's largest healthcare company announced yesterday that it will cut up to 7 per cent of its global workforce as part of an ongoing cost-cutting plan to generate savings of $1.7 billion by 2011.

The New Jersey-based consumer health company said that it would axe more than 7,000 workers as it tries to reduce layers of management from the approximately 117,000 strong workforce employed at more than 250 companies worldwide.

William Weldon, chairman and CEO, Johnson & JohnsonThe company said it is taking steps to prioritise its innovation efforts around the many growth opportunities in health care and to execute aggressively on bringing key new products to market.

The company's plans are expected to increase its operational efficiency and generate annualised, pre-tax cost savings of $1.4 - $1.7 billion when fully implemented in 2011, with $800-$900 million expected to be achieved in 2010.

The associated savings will provide additional resources to invest in new growth platforms; ensure the successful launch of its many new products and continued growth of its core businesses; and provide flexibility to adjust to the changed and evolving global environment.

''J&J has long adhered to a broad-based operating model and set of sound management principles that have driven our success,'' said William Weldon, J&J chairman and CEO. ''Today, we are announcing a series of actions and plans designed to ensure that our company remains well-positioned and appropriately structured for sustainable, long-term growth in the health care industry.''