During the early stretch of the 1990s, corporate America grew fond of downsizing, the practice of slashing work rolls in order to boost the bottom line. But, with the bull run of the late 1990s, downsizing was putatively discontinued and replaced by gentler methods of goosing profits. Thus, on this day in 1998, struggling electrical giant AMP, Inc. opted not to dump a chunk of its workforce, but instead forced 22,000 employees to take "mandatory furloughs." Along with this respite'-which took the form of either a week sans pay or a "week-long holiday"'-AMP also announced that 2,200 of its workers were volunteering for early retirement. Despite its status as the international leader in the field of electrical connections, AMP's sales had been hit hard by the recent Asian economic crisis. Company chief William Hudson also placed blame on "higher than normal pricing pressures in the marketplace and a strong dollar, which led to losses in foreign currency translations." The move marked the second time in as many months that AMP had mandated furloughs in hopes of soothing its various ailments. Despite their efforts to avoid layoffs, AMP later laid off nearly 4,000 employees in 1998, and while most jobs were replaced within a few months, an additional fifteen percent of AMP's workforce (including the jobs that were replaced from the first round of layoffs) was eliminated last April when AMP was bought out by Tyco International, Ltd. That same April, AMP's chairman and CEO Robert Ripp resigned, becoming yet another casualty of Tyco's buyout.
Source: www.history.com
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