The Magic Kingdom Offers Buyouts
The happiest place on earth is the latest company to try to cut back on overhead costs.
Disney's theme park division is offering buyouts to roughly 600 executives at its U.S. parks — that's nearly every executive in the division.
Disney says it’s trying to reduce the size of its executive workforce but says it has no target number of buyouts (or savings) and says it can't predict how many people will accept the buyout.
The executives have until February 6th to decide.
The parks are clearly facing the impact of the pullback in consumer spending—i.e. lower traffic and spending—and are trying to prepare. Leslie Goodman, EVP Worldwide Public Affairs for Walt Disney Parks and Resorts released a statement: "The Parks and resorts division is in the process of implementing a number of initiatives to contain costs and maximize efficiency.... Given the continued uncertainty of the economic environment, we must manage our business even more productively."
I got a look at the letter detailing the "Voluntary Separation Plan" offer—it includes "severance incentives, extended benefits and outplacement services." This buyout is going to be pricey enough that Disney's got to be looking to reduce its executive overhead for the long-term.
Unlike some other companies, which are announcing company-wide layoffs, Disney's individual divisions are announcing their layoffs and buyout plans independently. I'd expect to hear from more of the divisions over the next couple weeks.
And Disney is hardly alone.
Just this Tuesday Warner Bros. announced it's laying off 800 people, or 10 percent of its workforce. The same day broadcasting company Clear Channel Communications cut 1,850 jobs, about nine percent of its workforce. And I'm sure we'll hear more news of similar moves at other companies.
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