Nokia Becomes an Unemployment Sink Hole

Nokia (NYSE: NOK) has let go 7,000 people since CEO Stephen Elop joined the company after a career at Microsoft (NASDAQ: MSFT). He says Nokia will cut another 3,500 jobs. The firm announced it will shutter a plant in Cluj, Romania. Some of the jobs will be replaced by the “efficiency” of Asia plants. No matter what the reasons, Nokia joins a line of large multinational companies that have failed business plans that will cost thousands, and perhaps tens of thousands, of jobs.

The one thing politicians cannot do in the job creation process is to reverse the poor decisions made by large corporate boards and managements. Only so many infrastructure jobs or tax credits can reduce unemployment. These easily can be offset by executive incompetence. A glance at the troubles at Yahoo! (NASDAQ: YHOO), HP (NYSE: HPQ) or the U.S. Postal Service proves the argument. Stupidity is as great an enemy to employment as the recession is.

The difference between the economy and corporate management is that the GDP will eventually recover. A lack of executive competence will always be a factor in the jobs market.

Douglas A. McIntyre