American International Group is continuing to shed employees, announcing late last week the elimination of all but four of its US financial network offices and the consequent layoffs of hundreds of employees.
Some of the biggest losses come in Tennessee, where the insurer is shuttering about a dozen sales offices and letting go of at least 128 employees in Nashville. AIG’s main Tennessee office in Brentwood, which employees more than 900 people, also experienced some cuts but was largely unaffected.
About 50 workers were also laid off in the Tampa Bay area as all 14 of AIG’s financial network offices in the state were closed.
Employees were told Thursday at 11 a.m. that AIG was closing nearly all of its financial network offices in the US, saving only four that reportedly have strong ties to “Chinese markets.” Workers were given time to gather their personal belongings and were escorted out of the building by hired security personnel at noon.
Spokespersons for AIG declined to say how many people were being laid off nationwide, but did say the cuts were “critical to AIG’s overall strategic direction and simplified business model.” The company went on to say the layoffs will “ensure efficient resource allocation going forward.”
Financial analysts say the layoffs are not surprising, and some even say they doubt the cuts’ long-term financial efficacy.
“AIG is executing a plan now to cut between a billion and a billion and a half dollars of cost over the next three years,” Josh Stirling, a research analyst at Sanford Bernstein & Co. told Nashville Public Radio. “What the company is now doing…is a very long and arduous process of trying to fix itself, when it’s probably 10 to 20 years behind a lot of its competitors.”
The cuts come as AIG plans to shed up to 400 senior-level jobs and activist investor Carl Icahn continues to pressure the corporation to split into three separate companies to lower costs.
AIG plans to host a webcast giving an update on its strategy on January 26, where it says it will have a “proactive plan to drive shareholder value.”
The company will also release its fourth quarter earnings results on February 11.