Am I Next? DowDuPont Job Loss, Restructuring, Split, Activist Investors

Once again we are seeing outside activist investors demanding restructuring and “efficiencies” to improve shareholder value. Creating mostly tradable spreadsheet profits without any real regard to the companies and their underlying personnel. Of course, we release that any merger will cost jobs as duplicative functions and non-productive operations are reduced or eliminated. The question is how fast will job loss occur and is it better to be among the first to leave, seek lateral transfers, or simply wait-it-out to the bitter end? A question that can only be answered by the affected (or should we say afflicted) individual and their particular circumstances.

Here we find four major activist investors (Third Point LLC, Trian Fund Management LP, Glenview Capital Management LLC, and Jana Partners LLC) attempting to persuade management that their vision for the company should supersede that of the Board of Directors and senior management. Think Gordon Gecko in Wall Street. Individually, these activists own a tiny part of the company, but it is huge when measured against other shareholders. 

This deal has been cooking since 2015, so perhaps the cautionary tale is to track the major activist groups and see which companies are involved. The original plan called for the combined company to be disassociated into three separate companies with each having a more narrow focus: materials, agriculture, and specialty chemicals. One of the biggest points of contention is that the activist investors believe that the “Dow-Corning” assets should be deployed into a separate company and not the materials group.  

We have seen the recent split up of RR Donnelly into three separate enterprises is a similar fashion. Unfortunately for the shareholders, share value plummeted, and dividends were significantly reduced. In fact, it appears that the result was to make the individual parts more attractive to potential purchasers who wanted to buy additional capacity or a foothold in their core businesses.

Read the business news; it is often a portent of the future. 


If you are wondering why so many politicians seem clueless about the jobs situation in the United States, that's because the Bureau of Labor Statistics stopped tracking key decision-making data like green jobs employment, mass layoffs, and international labor comparisons.

It appears that President Barack Obama signed the sequestration legislation (formally known as the falsely-named Balanced Budget and Emergency Deficit Control Act on March 2013. It is not known whether or not these data collection and reporting programs will be restored under a President Trump.

The actions that were taken include: 

Eliminate the Measuring Green Jobs products.  -- "The BLS produces data on employment by industry and occupation for businesses that produce green goods and services. The BLS also conducts special employer surveys to provide data on the occupations and wages of jobs related to green technologies and practices, as well as develops and disseminates career information related to green jobs."

Eliminate the Mass Layoff Statistics program. -- "The Mass Layoff Statistics program provides information that identifies, describes, and tracks the effects of major job cutbacks in the economy."

Eliminate the International Labor Comparisons program. -- "The International Labor Comparisons program adjusts foreign data to a common framework of concepts, definitions, and classifications to facilitate data comparisons between the United States and other countries. ILC data are used to assess United States economic performance relative to other countries, as well as to evaluate the competitive position of the United States in international markets.

Data that is not collected cannot be used for making sound public policies and often leads to a disproportionate allocation of funding that disadvantages many American workers.

Am I Next? Job Loss: Politicians See No Evil