USG People cuts Dutch jobs

AMSTERDAM: Dutch staffing group USG People NV will cut almost 10 percent of its Dutch workforce following a slower-than-expected recovery in its local market, especially in the public and financial sector.

USG People, which is Europe's fourth-largest staffing firm by revenue, has been hit by slow growth in the Dutch market as local and national governments cut spending and Dutch banks restructure after suffering losses during the credit crisis.

"There is bit of a slower development particularly the government sector which is strongly reorganising which makes this suitable.

But even if the market was good, we would have done this," USG Chief Financial Officer Leen Geirnaerdt told Reuters.

The company will cut 360 full-time positions out of a total of 3,900 in the Netherlands and will close 5.5 percent or 34 of its Dutch offices following the introduction of new IT systems, it said in a statement on Thursday.

It will take a provision of 16 million euros in the second quarter and expects to generate 11 million in cost savings in the second half of this year, running up to 27 million annually in 2012, it said.

USG makes about 40 percent of its sales in the Netherlands, making it more dependent than its rivals on its home market, where it competes with Adecco, Randstad , Manpower and others.

Shares of USG People were up 2 percent at 11.975 euros by 1456 GMT. The Amsterdam midcap index was up 0.4 percent.

Copyright Reuters, 2011