Tata Iron and Steel Company Limited (Tisco) has stated that it is looking at downsizing its employee base by 5,000 in FY2001. The company had earlier undertaken a massive exercise to improve employee productivity.
Tisco (FY99 Net Sales Rs 62,746 m), a part of the Tata Group, is India's largest integrated private sector steel producer.
Tisco, long criticised for being overstaffed, has reduced its labour force to just over 59,000 in FY99 from a high of over 72,000 in FY96. The company is likely to close the current fiscal year with an employee base of 54,000. The company has posted operating margins of 18.3% in 1HFY00 as compared to 17.2% in the corresponding period last year.
The need for improving productivity has become all the more necessary with the significant increase in international competition. Although the company boasts of low operating costs, it is nonetheless feeling the burden of its mammoth work force. The move to reduce workforce further will take the company a step closer to becoming one of the most cost competitive producers of steel in the world.
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