More bad news wait Australian workers as another round of job cuts loom over employees of an insurer and the country's Foreign Affairs Department.
Reports said that Suncorp seeks to recover $200 million a year by axing jobs. However, the insurance firm did not provide specific numbers of positions to be shed.
To recover about $235 million in the form of annual savings by June 2013, Suncorp indicated that it would merge back-office operations in its insurance business. These changes are part of the strategy to combine the technology and operating structures of Suncorp over the next few years.
However, in doing things more efficiently, it would be inevitable that heads will roll in Suncorp, which plans to consolidate its 14 ageing technology platforms into two operating systems and to merge dozens of its insurance licenses.
The one-off investment cost for these changes is estimated at $275 million, to include redundancy payments for Suncorp employees who would be laid off.
"We've identified further savings through simplifying the business that, over 15 years of mergers, acquisitions and divestments, has become unnecessarily complex and cumbersome," Brisbane Times quoted Suncorp Chief Executive Patrick Snowball.
Meanwhile, the National Times reported that the Foreign Affairs Department sent a memo to its staff that there would be job cuts between 100 to 150 positions. New Foreign Minister Bob Carr provided more details of the lay offs when he attended the parliamentary hearings on the budget on Wednesday morning.
The move is expected to further decimate Australia's relatively small diplomatic network, which is one of the smallest globally even if the country is the world's 14th largest economy.
While the department would axe some jobs, it also announced that a new embassy in Senegal and a consulate in western China would open.
The Suncorp and Foreign Affairs job cuts follow the collapse of the Hastie Group and Game earlier this week which could leave a few thousand Australians unemployed. In the case of Hastie employees, 2,700 of them were stood down without pay for 28 days although the move is expected to eventually lead to their axing.
These developments are expected to impact Australia's unemployment rate which unexpectedly contracted to 4.9 per cent in April amid analysts and economists' forecast of a 5.3 per cent joblessness rate.
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