NU Online News Service
Allstate Corp. said it will reduce the work force at its home office complex by 10 percent, totaling between 600 and 700 workers.
The cutback is being done "to improve our competitive position and create operational efficiencies," according to a representative for the Northbrook, Ill.-based company, Mike Trevino.
Salaried employees were made a buyout offer earlier this week in the form of "enhanced severance in exchange for voluntary terminating," noted Mr. Trevino.
If the number of volunteers falls short of the target, he said the company "may have to employ a reduction in force."
He said of about 9,000 employees in the vicinity of Northbrook--a Chicago suburb--6,800 were made the offer of enhanced severance, "including me." Lower-level hourly employees were not made the offer.
The reduction, he said, is not intended to cover the carrier's increased reinsurance costs after $1.5 billion in hurricane losses, but to "improve our cost structure overall."
He could not put a figure on the cost savings involved. The money from the reduction will be put back into the business "as part of a continuing investment in the company," he said.
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