Procter & Gamble to cut 7,000 jobs as tariff pressure hits
The job cuts, announced at the Deutsche Bank Consumer Conference in Paris on Thursday, make up about 15% of its current non-manufacturing workforce, chief financial officer, Andre Schulten, said.
'This restructuring program is an important step toward ensuring our ability to deliver our long-term algorithm over the coming two to three years,' Schulten said. 'It does not, however, remove the near-term challenges that we currently face.'
Procter & Gamble, based in Cincinnati, had approximately 108,000 employees worldwide in June 2024.
The cuts are part of a broader restructuring program.
Procter & Gamble will also end sales of some of its products in certain markets. Procter & Gamble said it will provide more details about that in July.
In April, Procter & Gamble noted during a conference call that the biggest US tariff impacts were coming from raw and packaging materials and some finished product sourced from China. The company said that it would be looking at sourcing options and productivity improvements to mitigate the tariff impact, but that it may also have to raise prices on some products.
That same month, the Consumer Brands Association, which represents big food companies like Coca-Cola and General Mills as well as consumer product makers like Procter & Gamble, warned that although its businesses make most of their goods in the US, they now face tariffs on critical ingredients — like wood pulp for toilet paper or cinnamon — that must be imported because of domestic scarcity.
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2 days ago
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Procter & Gamble will cut 7,000 jobs over the next two years, as the Tide detergent maker contends with an uncertain spending environment, fueled in part by U.S. tariffs that have roiled numerous consumer companies. The world's largest consumer goods company also plans to exit some product categories and brands in certain markets, including some potential divestitures, as part of the broader two-year restructuring plan. "This is not a new approach, rather an intentional acceleration of the current strategy ... to win in the increasingly challenging environment in which we compete," executives said at a Deutsche Bank Consumer Conference in Paris on Thursday. The job cuts amount to about 6% of its workforce, which P&G characterized as part of its ongoing strategy. Notably, CFO Andre Schulten and operations head Shailesh Jejurikar said at the conference that the geopolitical environment was "unpredictable" and that consumers were facing "greater uncertainty." President Donald Trump 's sweeping levies on trading partners have shaken global markets and sparked concerns of a recession in the United States. P&G on Thursday estimated about a $600 million before-tax hit in its fiscal year 2026, based on current tariff rates, a number that has frequently shifted. Overall, the trade war has cost companies at least $34 billion in lost sales and higher costs, a Reuters analysis showed. In April, P&G said it would raise prices on some products, and Schulten said it was prepared to "pull every lever" in its arsenal to mitigate the impact of tariffs - primarily through higher prices and cost-cutting. "The two-year window ... gives them some flexibility in terms of timing and depth of cuts, as the tariff situation is very fluid," said Christian Greiner, senior portfolio manager at F/m Investments that owns shares in P&G. The restructuring will help simplify the organizational structure by "making roles broader" and "teams smaller", P&G said. The Pampers maker imports raw ingredients, packaging materials and some finished products into the U.S. from China. About 90% of what it sells is produced domestically, P&G has said. The company had about 108,000 employees as of June 2024. The job cuts would account for roughly 15% of its non-manufacturing workforce. P&G expects to record charges of $1 billion to $1.6 billion before-tax over the two-year period, with a quarter of the charges expected to be non-cash. Shares of the company were down about 2% in early trading. The stock has been largely flat over the past 12 months.
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The job cuts, announced at the Deutsche Bank Consumer Conference in Paris on Thursday, make up about 15% of its current non-manufacturing workforce, chief financial officer, Andre Schulten, said. 'This restructuring program is an important step toward ensuring our ability to deliver our long-term algorithm over the coming two to three years,' Schulten said. 'It does not, however, remove the near-term challenges that we currently face.' Procter & Gamble, based in Cincinnati, had approximately 108,000 employees worldwide in June 2024. The cuts are part of a broader restructuring program. Procter & Gamble will also end sales of some of its products in certain markets. Procter & Gamble said it will provide more details about that in July. In April, Procter & Gamble noted during a conference call that the biggest US tariff impacts were coming from raw and packaging materials and some finished product sourced from China. The company said that it would be looking at sourcing options and productivity improvements to mitigate the tariff impact, but that it may also have to raise prices on some products. That same month, the Consumer Brands Association, which represents big food companies like Coca-Cola and General Mills as well as consumer product makers like Procter & Gamble, warned that although its businesses make most of their goods in the US, they now face tariffs on critical ingredients — like wood pulp for toilet paper or cinnamon — that must be imported because of domestic scarcity.
