Professor Sherry Jarrell says Reynolds American Layoffs Can Help Company Remain Viable

3.16.2012 Article, Careers, Faculty News

Layoffs Are Part of Doing Business
Reposted from WFDD Radio

Reynolds American Layoffs Are A Part of Doing Business

March 16, 2012

One Triad business professor says the Reynolds American layoff is simply a part of doing business. The corporation has a national workforce of 5,400. Over the next two years, it'll retructure its operations and in the process lay off more than 500.

And some workers at RJ Reynolds Tobacco in Winston-Salem will lose their job.But Wake Forest University Finance and Economics Professor Sherry Jerrell says while lay offs are painful, its more important to the community for Reynolds American to stay viable. "Consumers can't generate wealth, they move money from one pocket to another. Governement's can't create wealth, they move money from one pocket to another," explains Jerrell. "Private industry is the only place where they can take in $10 of resources, cost capital and labor and create something that's worth $12."

Reynolds executives say the restructuring will save the company about $70 million by 2015.