Exclusive outtakes from industry leaders
from Chrystia Freeland:
During the depths of the financial crisis, Alcoa announced that it would lay off 13% of its global workforce, or about 13,500 people. Since then, they have built up their presence in China and Russia, finalized a new mine in Brazil, and started construction of the world's largest aluminum facilities in Saudi Arabia. Alcoa's rate of job creation in its home country of the United States, however, has been rather tepid in comparison.
Alcoa CEO Klaus Kleinfeld acknowledged that prospects for his business today were better abroad than they were at home, but he did note that in the past year Alcoa hired 1,500 people in the U.S. in the automotive and aerospace industries and so long as the United States retained its sense of entrepreneurship, creativity and excellence in higher education, jobs will come.
Dominic Barton was similarly sober about the current state of the U.S. labor market, saying that it's currently undergoing an acute phase of creative destruction. However, he urged the audience to focus on long-term job growth, citing the example of Samsung in the wake of Korea's financial crisis in 1997:
Samsung. In 1997 there was massive layoffs that were going on. So if you looked at them with the lens of what happened in that crisis, yep, they laid off a lot of people. The number of jobs they've created since because of the investments that they've made is many, many multiples of what they've lost. But they're different people. I think that what we need is this. There is restructuring, and there always will be restructuring. We can never get away from that. But what's -- what are the conditions that are in place in the country to enable jobs to be created? And that's something where I think business can help play a role. Not to subsidize jobs when they shouldn't exist, but to help create the conditions to do it.
from Chrystia Freeland:
It was striking to hear how encouraged both Klaus Kleinfeld and Dominic Barton sounded when Chrystia asked them about the effects of the recent turmoil in the Middle East on the business environment there. Barton believed the regime changes in Tunisia and Egypt were "the dawn of a new good thing that's occurring" and noted that it is likely that new capital will come into these countries as a new leadership emerges. Kleinfeld, whose company is in the process of building the world's largest integrated aluminum system in Saudi Arabia, said that Alcoa is still very comfortable in the region and that the only surprises with their Saudi partners have been positive surprises. For Kleinfeld, the most assured way to bring about stability in a region plagued by unrest is to have businesses come in and create jobs:
If there's one thing that the Middle East needs particularly for the young -- as well as well-educated people -- it's jobs. And it does it in a region which typically has not had much of an economic growth around Ras Azzour. So that's all very, very good. And not just for us as a company but also for the region. And it's gonna have a stabilizing as well as a kind of uplifting, positive element
On March 1, Alcoa CEO Klaus Kleinfeld sits down with Global Editor-at-large Chrystia Freeland as part of our Thomson Reuters Newsmaker event "Thriving in the New Global Economy."
WHO IS KLAUS KLEINFELD?
Kleinfeld, 53, was born in Bremen, Germany. He studied at the University of Goettingen, where he earned a master’s degree in business administration, and the University of Wuerzburg, where he gained a PhD in strategic management.
There is an entire industry out there about what to do to make a merger a success. Many of us know bankers or lawyers who work for weeks and hours on end just to make sure their deals are perfectly done with all the t’s crossed and the i’s dotted.
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