Leadership & People

UPDATE 1-Eastman Chemical to freeze wages, trim staff

(Reuters) - Eastman Chemical Co (EMN.N) will freeze wages, reduce hiring of contractors and trim its management staff, the company said on Wednesday in the latest move by the chemical sector to cut costs in the face of growing economic woes.

The chemicals, fibers and plastics maker said its total cost-cutting program would save it more than $100 million in 2009, with about $80 million of that from labor-related costs.

The recession in the United States, Europe and other regions has hit the chemical sector hard, and Eastman's larger peers Dow Chemical Co (DOW.N) and DuPont Co (DD.N) both announced job cuts earlier this month.

Eastman said on Dec. 2 its fourth-quarter earnings would miss its prior forecast, citing "unprecedented declines in demand."

The company's cuts in management staffing will result in a $5 million charge in the fourth quarter.

"Given the sudden and dramatic deterioration of the global economy, we are slowing work on some of our projects as it makes sense to do so," Chairman Chief Executive Brian Ferguson said in a statement.

Shares in Eastman closed at $31.20 on Tuesday, and have fallen nearly 50 percent so far this year. (Reporting by Matt Daily, editing by Dave Zimmerman)