Procter & Gamble Announces Major Workforce Reduction: 7,000 Jobs to Be Cut Amid Restructuring

Procter & Gamble (P&G), the global consumer goods giant, has revealed plans to cut 7,000 jobs over the next two years, representing 6% of its total workforce. This decision is part of a broader restructuring program aimed at simplifying the company's organizational structure and responding to the challenges posed by tariffs and geopolitical uncertainties.

Key Details of the Restructuring Plan

• The job cuts will primarily affect the non-manufacturing workforce, accounting for roughly 15% of this segment.
• P&G expects to incur $1bn to $1.6bn in pre-tax charges over the two-year period, with a quarter of these charges being non-cash.
• The company also plans to exit certain product categories and brands in specific markets, including potential divestitures.

Geopolitical and Economic Factors

P&G's CFO, Andre Schulten, and operations head, Shailesh Jejurikar, highlighted the "unpredictable" geopolitical environment and the "greater uncertainty" faced by consumers. The company has already taken steps to mitigate the impact of tariffs, including raising prices on some products and implementing cost-cutting measures.

• Tariff Impact: P&G estimates a $600m before-tax hit in fiscal year 2026 due to current tariff rates.
• Consumer Sentiment: The ongoing trade war has contributed to a decline in US consumer sentiment, which has fallen for the fifth consecutive month.

Market Reaction

P&G's shares experienced a 2% drop in early trading following the announcement. Although there was a slight recovery, the stock remains 1% lower than the previous market close. Over the past five trading days, P&G's stock has declined by 2.7%, and it is down 1.2% since the beginning of the year.

Broader Implications

The restructuring reflects the broader challenges faced by multinational corporations in navigating tariff-related costs and geopolitical instability. P&G's move to streamline its operations and reduce its workforce underscores the need for companies to adapt to an increasingly volatile global market.