Fidelity layoffs slated to start

Fidelity Investments is expected to initiate a round of previously disclosed layoffs this week, according to industry executives who have been informed by company insiders, and the job cuts will likely include personnel from the company's FMR Co. investment unit.

A Fidelity spokeswoman did not give many details yesterday except to refer to the company's statements from last fall, when it revealed roughly 3,000 job cuts - 1,300 that began in November and at least another 1,700 that would take place in the first quarter of 2009. Fidelity hasn't said how many of the eliminated jobs will be in Massachusetts, where it had about 11,000 employees last year.

The FMR Co. division includes analysts and managers who run Fidelity's well-known mutual funds, and it had been shielded from past layoffs after the company spent heavily to beef up its stock-picking capabilities. Crowley said the company now has about 500 analysts. One executive recruiter who has spoken with company insiders, speaking on condition of anonymity because Fidelity did not authorize the comments, said positions at FMR Co. will be eliminated this week.

Eric Kobren, publisher of an independent newsletter for Fidelity investors, said any cuts to FMR could indicate Fidelity's spending on new staff hasn't always paid off. "They've got to be very sensitive to the fact of how many analysts add value to the process. They spent hundreds of millions of dollars improving their staff, and the fund performance numbers have not necessary improved in line with the investment," Kobren said.

Revenue at family-controlled Fidelity is down sharply because of the decline in financial markets last year, and also because investors shifted money to safe money market mutual funds, which charge lower fees. Other financial firms in Boston have also initiated job cuts, including State Street Corp. and Wellington Management.


Source: boston.com