* Top companies across Europe plan wide job cuts
* Pain spreads to Sweden as exporters feel euro zone impact
* Ericsson joins ING, Kloeckner in new layoff moves
By Simon Johnson and Patrick Lannin
STOCKHOLM, Nov 7 Companies as diverse as
telecoms equipment group Ericsson, bank ING, steel group
Kloeckner and engineering firm Bombardier announced sweeping job
cuts on Wednesday as economic worries spread across some of
Europe's strongest economies.
Even previously safe haven Nordic states like Sweden have
had to adjust to lower demand. World number one mobile telecom
network equipment maker Ericsson said it was cutting
9 percent of staff there.
Germany's second-biggest lender, Commerzbank, was
reported by newspaper Die Zeit to be set to cut 5,000-6,000 jobs
and Dutch financial group ING said it aimed to lose
more than 2,000 jobs worldwide.
That would add to the 10,000 jobs in the financial sector
which Swiss giant UBS plans to cut.
European Central Bank President Mario Draghi said on
Wednesday that investors were returning to the euro zone,
, but the European Commission forecast barely any
growth in the single currency area next year.
"Make no mistake about it, this is an across-the-board
economic downturn that's sparing no country in the EU," said
Nicholas Spiro, director of Spiro Sovereign Strategy consultants
The U.S. recovery has also been faltering, overshadowing
prospects for business and underlining the problems facing a
re-elected President Barack Obama.
Others lining up to announce job cuts on Wednesday were wind
turbine maker Vestas in Denmark, to lose 3,000 staff, garden
equipment maker Husqvarna of Sweden, cutting 600, and German
steel distributor Kloeckner & Co, where losses will
be equivalent to 16 percent of its workforce.
Canada's Bombardier Inc said it would cut about 1,200 jobs
worldwide, including at a plant in Aachen, Germany.
The news came as figures showed German industrial output
fell by a worse than expected 1.8 percent in September and
government advisers said the economy would grow by just 0.8
percent this year and next amid the euro zone gloom.
In the euro zone, unemployment rose to new record highs in
September, with 18.49 million people without work, up by 146,000
from the month before, according to Eurostat.
U.S. companies have also focussed their cost cutting in
Europe. Dow Chemical plans to cut 2,400 positions, Ford Motor Co
is firing thousands in Belgium and diaper and tissue maker
Kimberley-Clark aims to leave low-profit businesses in Europe.
Ericsson's loss of 1,550 of its 17,786 staff in Sweden
showed the problems of the euro zone are spreading and affecting
the biggest Nordic economy, which had previously outperformed
other countries in Europe.
The blue-chip firm, with 109,200 staff in more than 180
countries, said the cuts were inevitable after third quarter
core profit fell 42 percent due to slower orders and a shift in
business mix to less profitable contracts.
"Export industries are having a really tough time and it is
clear they are being hit by the global weakness," said chief
analyst Torbjorn Isaksson at Stockholm-based bank Nordea.
"We expect to see (Swedish) unemployment above 8 percent
quite soon, in the winter we could see it somewhere around 8.5
percent due to falling employment and also high labour supply,"
he said. In September, the jobless rate was 7.4 percent.
Still, such levels of joblessness are better than in the
crisis-hit countries of the euro zone.
In Greece, at the centre of the sovereign debt crisis, the
jobless rate is 25 percent. In Sweden, the government has leeway
to spend more on its already generous welfare programmes if it
wants, while austerity is in full swing in Athens.
But unemployment is one of the biggest issues among Swedish
voters and a revitalised opposition is making grounds in polls
in part due to fears of further job losses.
The Swedish central bank has cut rates twice this year and
at its last meeting, when it held at 1.25 percent, it held out
the prospect of a rate cut in December.
In the euro zone, the European Central Bank is expected to
leave interest rates unchanged on Thursday, even after a raft of
weak economic data.