Reuters reports that American Express announced plans after the stock market closed Monday to layoff 4,000 people, about 6% of its workforce. It will also cut $625 million on marketing, business development, consulting and other services.
The cuts are part of the New York-based company's plan to save $800 million over the rest of 2009.
American Express plans to take an after-tax charge of $117 million to $163 million in the second quarter, largely associated with the job cuts. It said the cuts will occur across a variety of businesses, saving $175 million.
The company also plans to cut spending by $500 million on marketing and business development and $125 million on consulting and other services, travel and overhead.
American Express has been struggling from people who are unable to pay credit card balances because they have been laid off.
American Express CEO said in a statement, "While we have remained solidly profitable at a time when some parts of the card industry were incurring substantial losses, we continue to be very cautious about the economic outlook and are therefore moving forward with additional reengineering efforts to help further reduce our operating costs. We believe these efforts will put us in a better position to remain profitable and free up some additional resources that will be reinvested in the business to make sure we can take competitive advantage of opportunities as the economy begins to rebound."
Reuters 
