Stryker Corp.'s
plans to layoff about 5 percent of its worldwide staff to cut costs — a
move announced by the medical products company last Thursday — have
some worried about the spin-off effect it may have in the community.
It seems to be an even bigger concern, however, to some from the political standpoint.
They are squarely blaming the new Medical Device Excise Tax and the Obama administration for the Kalamazoo-based company's decision.
“We’ve already got the highest unemployment rate in the country,” said Charlie Owens, state director of the National Federation of Independent Business. “Clearly, the federal law is aggravating the problem and it’s undermining the state’s effort to improve the economic climate.”
Stryker Chairman, President and CEO Stephen P. MacMillan said the decision was a result of “a challenging economic environment and a market slowdown in elective medical procedures,” as well as the need to prepare for the new tax.
The company said that it will look to cut its 20,036-person worldwide staff before the end of 2012 and restructure some of its operations in order to wring out about $100 million in pre-tax operating costs savings. It said it expects the Medical Device Excise Tax, which requires the makers of various medical devices to pay 2.3 percent of their gross U.S. revenues on such products beginning in 2013, to cost it about $150 million.
If Stryker does an across-the-board cut of its 2,250-person Kalamazoo-area workforce, about 112 local workers would lose their jobs. About 1,002 of its worldwide workforce would be cut.
“It’s unintended, but not unpredictable,” Owens said. “The layoffs next year at Stryker because of the law will affect a lot of families in the Kalamazoo area, including the families who depend on the local small businesses.”
Read more: http://www.mlive.com/business/west-michigan/index.ssf/2011/11/stryker_corp_layoff_plans_stri.html
It seems to be an even bigger concern, however, to some from the political standpoint.
They are squarely blaming the new Medical Device Excise Tax and the Obama administration for the Kalamazoo-based company's decision.
“We’ve already got the highest unemployment rate in the country,” said Charlie Owens, state director of the National Federation of Independent Business. “Clearly, the federal law is aggravating the problem and it’s undermining the state’s effort to improve the economic climate.”
Stryker Chairman, President and CEO Stephen P. MacMillan said the decision was a result of “a challenging economic environment and a market slowdown in elective medical procedures,” as well as the need to prepare for the new tax.
The company said that it will look to cut its 20,036-person worldwide staff before the end of 2012 and restructure some of its operations in order to wring out about $100 million in pre-tax operating costs savings. It said it expects the Medical Device Excise Tax, which requires the makers of various medical devices to pay 2.3 percent of their gross U.S. revenues on such products beginning in 2013, to cost it about $150 million.
If Stryker does an across-the-board cut of its 2,250-person Kalamazoo-area workforce, about 112 local workers would lose their jobs. About 1,002 of its worldwide workforce would be cut.
“It’s unintended, but not unpredictable,” Owens said. “The layoffs next year at Stryker because of the law will affect a lot of families in the Kalamazoo area, including the families who depend on the local small businesses.”
Read more: http://www.mlive.com/business/west-michigan/index.ssf/2011/11/stryker_corp_layoff_plans_stri.html
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