Transamerica Corp. will lay off greater than 100 of its remaining staff on the firm’s Worker Advantages (TEB) group in Little Rock by the tip of 2019, bringing to shut a protracted interval of downsizing and job cuts that started almost 5 years in the past, an organization spokesman advised Discuss Enterprise and Politics on Monday (April 26).
The announcement by the worldwide insurance coverage large will finish TEB’s long term over almost twenty years because the U.S. headquarters for the corporate’s enterprise unit that sells voluntary life and different supplemental medical health insurance merchandise to employers on the office.
“Transamerica regularly assesses its location technique to make sure alignment with our enterprise necessities and monetary aims,” stated the Transamerica spokesman who requested to not be recognized. “We’ve decided that Little Rock is now not a long-term strategic location for our operations and we’ll shut our workplace there on the finish of 2019.”
In the present day, Transamerica’s U.S. company headquarters are in Baltimore, Maryland, with different main operations in Cedar Rapids, Iowa. Transamerica is the U.S. arm of the publicly-traded Aegon Group, The Hague, Netherlands-based monetary companies large that is without doubt one of the world’s largest suppliers of life insurance coverage, pension options and asset administration merchandise, working in over 25 international markets with some 28,000 staff.
In late February, Aegon reported that its worldwide income fell 83% within the second half of 2018 from $1.62 billion to solely $286 million as the corporate confronted main monetary headwinds, particularly within the U.S. market. As well as, Aegon’s income in 2018 fell almost 8.4% to $34.1 billion, properly beneath yearly international gross sales topping $37 billion in 2016 and 2017.
Aegon CEO Alex Wynaendts blamed the declining income on unfavorable market actions, primarily within the U.S., together with a $195 million authorized settlement involving Transamerica life insurance coverage policyholders and the divestment of the corporate’s final block of reinsurance enterprise, which was a part of TEB’s portfolio of merchandise.
“The second half of 2018 was difficult as we skilled a big decline within the markets in the direction of the tip of the 12 months. This impacted the worth of our clients’ investments, and thereby the outcomes of our administration and companies companies,” Wynaendts stated in asserting the corporate’s dismal earnings report in late February.
“On the identical time, we proceed to simplify the group, strengthen relationships with our clients and advisors, and improve our service ranges,” stated Wynaendts. “This 12 months’s extension of our partnership with Atos within the UK and the brand new partnership with TCS within the U.S. permit us to modernize our administration programs, and supply sooner and higher propositions to our clients.”
SEPARATION PACKAGES, OUTPLACEMENT SERVICES OFFERED
In line with the Transamerica spokesperson, roughly 110 Transamerica staff in Little Rock have been affected by the newest realignment. The influence on every worker is determined by their job operate, he stated, with some staff receiving affords to earn a living from home for a specified or indefinite interval.
“By the tip of 2019, we anticipate the full variety of place eliminations in Little Rock to be about 70,” the corporate spokesperson stated. “We’re keenly conscious of the influence these actions can have on our staff and their households. Because of this, we might be providing separation advantages to eligible staff, together with outplacement companies.”
Transamerica first landed in Little Rock in 2002 when then-Gov. Mike Huckabee and greater than 100 native dignitaries celebrated the topping out ceremony of Transamerica Worksite Advertising’s model new three-story, 105,000 sq. foot workplace complicated on 18 acres in west Little Rock. On the time, the corporate introduced plans for 200 largely white-collar jobs regionally, together with some positions stuffed by transfers from the previous worksite advertising and marketing headquarters in California.
At its peak, when the insurance coverage agency modified its title from Worker Advantages in a companywide rebranding in 2013, Transamerica employed almost 500 staff regionally. However in late 2016, the corporate’s U.S. headquarters in Baltimore introduced greater than 800 job cuts throughout the U.S. as a part of a companywide cost-cutting and reorganization program, together with 20 layoffs at TEB.
As famous by Wynaendts, Transamerica introduced a take care of Mumbai, India-based Tata Consultancy Companies (TCS) in early January 2018 with plans to remodel the administration of the corporate’s insurance coverage and annuity enterprise traces within the U.S. by accelerating efforts to outsource its digital capabilities and modernize all expertise platforms.
Below that reorg plan, firm officers stated almost 2,200 Transamerica staff supporting the TEB and different enterprise traces concerned within the shakeup could be supplied positions by TCS, together with 200 in Little Rock. As a part of the deal, the Indian tech agency with annual income of $20.9 billion took over occupancy of a number of flooring at Transamerica’s 1400 Centerview workplace constructing as a part of a multi-year pact.
That deal additionally allowed Transamerica to shift greater than $2 billion in revenues and 1000’s of firm staff to TCS’s payroll, reducing the corporate’s annual bills within the U.S. by $70 million. It additionally was forecasted to supply annual financial savings of $100 million over three years as transition and conversion expenses on the corporate’s half-year financials.
In line with TCS officers, the corporate’s native places of work in Little Rock can have digital capabilities to service 10 million Transamerica insurance coverage insurance policies on an built-in fashionable IT platform. The native workplace is a brand new U.S. enterprise middle for TCS, including to the tech agency’s current workplace in Bentonville that employs greater than 150 staff.
In November 2018, Hathaway Group introduced the acquisition and new occupancy plans for the Transamerica constructing. The property was bought for simply over $9 million from Transamerica Life Insurance coverage Firm by the 1400 Centerview LLC. That investor group included Larry Crain Jr., Jeff Hathaway, John Hathaway and Wes Martin of Hathaway Group; and different Hathaway Group purchasers.
Though the corporate is exiting Little Rock, Transamerica officers stated the corporate’s Worker Advantages enterprise line will proceed to be “an integral a part of our technique, and we’re persevering with to develop this market with expertise in different U.S. areas.”