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CMU Expert: Alcoa Had No Choice

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Jan 6, 2009 10:46 pm US/Eastern

CMU Expert: Alcoa Had No Choice

Reporting
Ralph Iannotti
PITTSBURGH (KDKA) ― Alcoa announced it's slashing its global workforce.

Professor Lester Lave at Carnegie Mellon University's School of Business said Alcoa had no choice but to announce a series of drastic cutbacks because of the worldwide recession.

Alcoa is furloughing 13 percent of its workforce - about 13,500 jobs globally - imposing both salary and hiring freezes and eliminating 1,700 contract positions.

"I think it is very unfortunate for all of those people who were laid off - my heart goes out to those people," says Lave, "but, I think that it's more important that the company survive and all of those people who are still working for the company still have jobs. 

"That's a better outcome than if Alcoa had tried to sort of bluff it out and then wound up going into bankruptcy," he added.

Alcoa, with a long presence in Pittsburgh, has a corporate and business center on the North Shore and a technology center in Westmoreland County. Its local workforce is about 1,800. Top company executives have relocated in New York City.

A spokesman could not say specifically how many local jobs would be lost, but one source says as many as 250 corporate positions may be eliminated.

Aluminum giant Alcoa had previously announced layoffs and plant closings but they were clearly not enough to help the company make it through the current economic downturn. 

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