Siemens to cut 2,500 jobs in oil & gas supply

GERMAN industrial manufacturer Siemens has announced plans to cut 2,500 jobs in its oil, gas and mining units due to decreasing demand for large processing equipment.

The oil price for much of 2015/16 has been under US$40/bbl, with only slight peaks above in the last few days. This has affected the industry’s supply chain as oil firms are not willing to invest in new equipment at such a volatile time.

Jürgen Brandes, head of process industries at Siemens, said, “Plunging demand in raw materials markets has led to a significant intensification of competition. We’ve got to adapt to these conditions. That's why we've got to optimise our manufacturing network.”

Approximately 2,000 of the losses will be confined to Siemens’ large drives and process solutions units in Munich. The total loss represents less than 1% of Siemens’ 348,000 global workforces.

The cuts are part of a larger “realignment” that has been ongoing since CEO Joe Kaeser took over Siemens in the summer of 2013. Siemens has also announced more than €1bn (US$1.1bn) investment into its research and development division, and is expected to hire 25,000 new employees per year worldwide for the foreseeable future.