Financialization coincided with dramatic employment cuts at GE

Evidence

Coinciding with the growth of GE Capital in the 1980s was a 50% reduction of GE employment, both by selling off production units and by slashing employment in the remaining units. Jack Welch thus earned the nickname “Neutron Jack”—like a tactical atomic bomb turning people into dust but leaving buildings still standing ðNew York Times 2001Þ. If financialization also leads to a long-run reduction of employment, we are likely to underestimate its effect on labor’s share of income and officers’ compensation since relative employment size is included in the models. — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 181

Categorization

• CANDY: “Neutron Jack” and the atomic-bomb-emptying-buildings image is an instantly quotable anecdote about financialized management. Note: the author wrote ‘Conceco’ for Conseco [177], a typo.
• XREF: The ‘trivial’ employment cost of financialization connects to the reader’s interests in how financial logic reshapes firms and labor — and to the ADDENDUM article on sacrifice where firms discard loyal workers. — connects to: GE’s finance arm outgrew its industrial parent and dominates its profits — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 44; Financialization shifted corporate power from manufacturing and marketing executives toward financial executives. — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 21; Financialization drives the rise of precarious labor and dissolves social bonds — Max Haiven, Cultures of Financialization, 141

Related

• GE’s finance arm outgrew its industrial parent and dominates its profits (similarity 0.83)

Broader Connections

• GE’s finance arm outgrew its industrial parent and dominates its profits #corroborates (0.88) — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 44
• Financialization shifted corporate power from manufacturing and marketing executives toward financial executives. #expands (0.80) — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 21
• Financialization drives the rise of precarious labor and dissolves social bonds #expands (0.75) — Max Haiven, Cultures of Financialization, 141