Tomahawk, WI 10/02/2013 (BasicsMedia) – Merck & Co., Inc. (NYSE:MRK) has been involved in the health care field for ages. It is a global brand which is well known for its health care solutions mostly targeted towards producing prescription medicines, biologic therapies, and vaccines. Moreover, the company is also quite efficient in the animal health care industry. It has also not been left behind in the production of consumer care products at a global scale. The company has announced that it is to slash some 8,500 jobs and this elicited a lot of excitement with many asking for reasons behind this decision.

 MRK Fires 16,000 Employees in Total

 The company is an employer of close to 81,000 but the number is set to be cut down massively, by as much as 20%, when the job cuts are implemented fully as it is expected. The latest announcement that it will slash the number of its employees by 8,500 comes hot on the heels of another one where it said it would reduce its workforce by 7,500. If the two decisions are implemented in full as the company recently announced, it will see 16,000 of its employees no longer working for MRK. The question analysts are asking is; what are MRK’s reasons for this?

 MRK has stated that it is carrying out this move because it wants to place a lot of emphasis on research and development. Therefore, it needs to raise more money in order to carry out further research on its products, especially those it wants to introduce into the market. Furthermore, the best way of raising more money is by cutting down on expenses. The company firmly believes that it already has a large pool of employees and that those who remain at the conclusion of these job cuts, will still be able to perform tasks which are pertinent to MRK’s survival.

 The second reason which MRK has issued regarding its latest job cuts move is that it wants to focus more on giving its investors good returns. This is bound to be welcome news among its many investors since they also need to enjoy the fruit of their investments. If by cutting down its workforce MRK is able to give them what they need, there would be nothing wrong with this. If it is unable to reward its investors well after these latest job cuts, the company will be blamed and its decision could be challenged on the basis of having failed to achieve its objectives.

 MRK Priority Markets

MRK has prepared a list of markets which it intends to give great priority to. These 10 markets include China, Russia, the U.S., the U.K, Brazil, Korea, Canada, Germany, France and Japan. Is decision to reduce the workforce is informed by the fact that it has to research and develop its products for these ten priority markets, which it hopes will contribute a lot to improving its bottom-line. The decision to cut down on its workforce will only be justified or not, depending on the kind of results it posts regarding its operations in these ten priority markets.

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