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Fri January 18, 2013
State Street to Lay Off 260 in Mass., Despite Tax Break
News broke today that Boston-based State Street Corp. is poised to lay off 630 people — including 260 right here in Massachusetts. The cuts come despite the fact that State Street seems to be doing quite well financially, with both its fourth-quarter revenues and earnings per share up compared to the fourth quarter of 2011.
Thus far, coverage of the impending cutbacks is omitting one key detail. Earlier this year, State Street landed an $11.5 million tax break from the city of Boston to build new offices on the South Boston waterfront.
In a statement lauding that deal, Boston Mayor Tom Menino suggested that keeping State Street in the city would keep jobs there, too. As the mayor put it at the time: “Keeping this economic giant in the city not only ensures that we are retaining jobs, but is a key to attracting new jobs and creating an economically successful and vibrant city."
I've asked Mayor Menino to comment on today's news, and will provide an update here if and when he does.
Last year, Greater Boston spoke with Dan Armstrong, a disgruntled former State Street employee who accused State Street of quietly outsourcing hundreds of jobs — and said he and his colleagues were forced to train the Indian workers who'd eventually replace them.
Alison Quirk, State Street's Chief HR and Citizenship Officer, declined to confirm or deny Armstrong's account. She also refused to say whether State Street's employee total would grow or decline in the coming years. But, Quirk said, "We are committed to being here." Today's news suggests that that commitment has its limits.