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President Donald Trump’s sweeping tariffs on trading partners have roiled global markets and led to fears of a recession in the U.S., the biggest market for P&G. The company now has decided to cut 7,000 jobs, or about 6%, of its total workforce over the next two years. Procter & Gamble imports raw ingredients, packaging materials and some finished products into the U.S. from China.
The company in its statement has said that this is being done as part of a new restructuring plan to counter uneven consumer demand and higher costs due to tariff uncertainty.
The world’s largest consumer goods company also plans to exit some product categories and brands in certain markets, executives said at a Deutsche Bank Consumer Conference in Paris, adding the program could likely include some divestitures without giving detail.
The Pampers maker’s two-year restructuring plan comes when consumer spending is expected to remain pressured this year, and global consumer goods makers including P&G and Unilever brace for a further hit to demand from even higher prices.
In the last few months, the costs of many FMCG companies around the world, including the US, have increased, especially due to import duties and supply chain problems. Apart from this, the spending tendency of customers has also declined, which has increased the pressure on companies to save profits. P&G says that it is not only reducing jobs, but is also preparing to stop selling some of its products in some markets. Detailed information about these changes will be shared in July.
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