Layoffs follow buyouts at Fidelity Investments
Fidelity Investments, the mutual fund manager controlled by the Johnson family, laid off hundreds of employees just weeks after more than 1,500 workers tool voluntary buyouts.
The Boston Globe reported that less than 1% of the national workforce was affected by the layoffs, although a spokesman declined to say how many employees would lose their jobs.
The Globe report noted that Fidelity’s actively managed mutual funds have fallen out of favor, while lower-cost passively managed funds have become more popular.
The Boston Business Journal noted that Fidelity is making the cuts even though it earned a record $3.5 billion in operating profit last year.
CEO Abigail Johnson wrote in an annual letter to shareholders for 2016 that Fidelity had begun “a new multiyear program to drive efficiency across the company,” the Globe report noted. (Sources: Boston Globe, July 12, 2017; Boston Business Journal, July 11, 2017.)