ATLANTA - -Shipping giant UPS Inc. will cut 1,800 management and administrative jobs nationwide and close a district office in Maryland as it repositions itself for a gradual economic recovery.
About 1,100 employees will be offered a voluntary separation package as part of the work force reduction, which is meant to streamline the company's U.S. small-package segment. Other cuts will come through attrition and layoffs. The U.S. small-package segment represents roughly 60 percent of UPS' annual revenue. It handles shipments of up to 150 pounds by ground and air.
The district office in Laurel, which serves the Baltimore area, is combining with offices in Philadelphia. About 45 jobs in Laurel will be eliminated through early retirements, layoffs and attrition, said UPS spokesman Norman Black. The district offices have back-office jobs such as human resources, work force planning and automotive maintenance oversight, Black said.
"The technology and management systems available to us today allow us to manage larger geographic areas" with fewer offices, Black said.
The 1,800 jobs represent less than 1 percent of UPS' global work force. The company will reduce its U.S. regions from five to three and its U.S. districts from 46 to 20 in April.
UPS, based in Atlanta, has 408,000 employees worldwide. About 340,000 are in the United States.
UPS raised its profit forecast for the fourth-quarter, which ended in December, citing improving operations and cost cuts.
There are no plans to close any operating facilities. UPS said the consolidation of offices will not affect the sales and operations team, including drivers. UPS expects to incur a one-time charge in 2010 because of the restructuring.
"The stronger earnings stem from better-than-expected results in both domestic and international operations and savings through cost management," Chief Financial Officer Kurt Kuehn said in a statement. "However, we still anticipate a gradual economic recovery with improvement more evident as 2010 progresses."
UPS previously cut thousands of jobs and held down costs during the economic downturn. As of the end of the second quarter, it had shed 15,000 jobs, mostly through attrition, since the same time in 2008. In early 2009, UPS said it would freeze management salaries and suspend 401(k) matches for employees.
The company's chief rival, FedEx, reported second-quarter earnings last month down 30 percent from a year earlier. FedEx, based in Memphis, Tenn., said the economy has "reached a turning point," but full recovery may still be a long way off.
U.S. operations of UPS and FedEx have been hurt as consumers and businesses shipped less and slowed remaining shipments to save money amid the weak economy.
Baltimore Sun reporter Andrea K. Walker contributed to this article.