MAY 28, 2023 — LAYOFFS APPROACH IN CALIFORNIA
The company has announced that it is discontinuing accepting property and casualty insurance business in the State of California which potentially impacts those selling and servicing those policies.
“State Farm General Insurance Company, State Farm’s provider of homeowners insurance in California, will cease accepting new applications including all business and personal lines property and casualty insurance, effective May 27, 2023. This decision does not impact personal auto insurance. State Farm General Insurance Company made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.”
JANUARY 12, 2023 —OUTSOURCING IT SERVICES TO INDIA
The company has announced that it will outsource information technology services to HCLTech, an IT company based in Noida, India, further noting there will be layoffs.
The outsourcing will impact 451 positions at the end of March 2023.
According to a company spokesperson, “HCLTech will handle the day-to-day IT Help Desk and infrastructure service work, managing the hardware, software, and network connections for State Farm, beginning in early 2023.”
“We did not make this unique decision lightly. State Farm considers the best interest of customers, employees, and agents when adapting to the ever-changing business environment to meet evolving needs. We’re committed to continuously improving processes, departments, and structure to better serve our customers. This new relationship allows State Farm to focus on critical technology priorities, addresses recruiting and retention challenges, and helps deliver quick, efficient, and consistent tech support to customers, agents, and employees,”
WARNING: If the outsourcing scenario plays out like previous transitions to foreign-owned vendors, some critical employees will be re-badged as employees or contractors of the vendor until they can be replaced with the vendor’s native employees at a lower wage and benefits schedule — further reducing fixed overhead costs.
NOVEMBER 24, 2020 — 111 LAYOFFS IN EARTH CITY, MISSOURI
The company has announced the closure of its Eart City office and 111 permanent layoffs commencing January 31, 2021.
Layoffs include banking positions, such as customer service representatives, bank operations representatives, consumer loan credit analysts and other support personnel.
The decision was driven by the company’s desire to exit banking operations after implementing an alliance with U.S. Bank earlier this year.
MARCH 10, 2020 — PLANNED EXIT FROM BANKING OPERATIONS
The company has executed its plan to withdraw from banking activities by forming a strategic alliance with U.S. Bank which will assume State Farm Bank’s existing deposit and credit card accounts. State Farm agents will now market U.S. Bank deposit products and co-branded credit cards to State Farm customers.
JUNE 30, 2019 — CLOSURE OF JACKSONVILLE OPERATIONS CENTER
The company has announced the closure of its Jacksonville Operations Center in Jacksonville, Florida resulting in the permanent loss of 300 jobs. 143 jobs by August 31, 2019 and another 157 jobs in November 2019. The center mostly handles customer service and billing.
According to a company spokesperson, the reduction in force is partly attributable to business conditions and the increased use of automation.
SEPTEMBER 4, 2018 — CONTINUING LAYOFFS IN A PLANNED RESTRUCTURING — 4,200 EMPLOYEES SCHEDULED TO LOSE THEIR JOBS IN A PHASED LAYOFF
100 claims and administrative support employees at State Farm’s Jacksonville, Florida Operations Center in addition to another 600 employees. According to a company spokesperson, the decision was based on the need to "adapt to the rapidly changing needs and expectations" of customers, leverage technology, and optimize available space in its facilities.” The facility should be completely closed by 2019.
59 employees at the company’s Tampa, Florida operations center.
88 inspectors, claims processors, and support staff will be laid off at the company’s operations center in Mendota Height, Minnesota. The facility is to be closed by 2019. A company spokesperson noted, “State Farm is gaining efficiency through streamlining and improving processes, leveraging technology and concentrating employees in larger locations.”
269 workers in a facility closure in the Tacoma, Washington operations center. Again, with the corporate-speak, a spokesperson claimed that the closure is about "gaining efficiency through streamlining and improving processes, adapting to the rapidly changing needs and expectations of our customers, leveraging technology, and optimizing available space in our current facilities."
82 employees in a facility closure in New Hyde Park, New York.
This should not come as a surprise to State Farm’s operations employees as the company announced the closure of approximately eleven facilities due to major losses in 2017 when the handwriting was clearly on the wall. At that time the headcount reduction was estimated at 4,200 employees.
The May 4, 2017 notice on the company’s site stated…
“State Farm Mutual Automobile Insurance Company today announced plans to exit eleven facilities in stages over the course of several years, beginning in 2018. The work from these facilities will move to the company’s headquarters in Bloomington, Ill., its offices in Atlanta, Dallas, and Phoenix, as well as a number of existing locations across the U.S. These changes will affect approximately 4,200 of the company’s nearly 70,000 employees. These employees will continue to have job opportunities in other State Farm locations.”
“We understand the decision to exit these facilities directly affects our employees and their communities. While the exits will begin in 2018 and continue over several years, we are announcing this decision now in order to give employees time to make personal and professional decisions. The company will continue to have a strong local presence in these communities through our agents and local claims employees,” said Mary Schmidt, executive vice president and chief administrative officer.”
“The company’s decision to exit these facilities was based on efforts to best serve customers by gaining efficiency through streamlining and improving processes, leveraging technology, and concentrating employees in larger locations.”
“In order to adapt to the changing needs of our customers and continue to provide the remarkable service that our customers expect, we must continue to manage our business efficiently,” added Schmidt.
State Farm intends to exit the following locations according to the projected timeline below — 2018: Parsippipany, New Jersey, Petaluma, California; 2019: Kalamazoo, Michigan, Irvine, California, Tulsa, Oklahoma; 2020: Indianapolis, Indiana, Medley, Flordia, Downers Grove, Illinois, West Lafayette, Indiana; 2021: Bakersfield, California, Federick, Maryland.
MARCH 7, 2018 — RESTRUCTURING KILLS 890 IT JOBS
Faced with two years of major operating losses, State Farm has embarked upon a restructuring program that will see the elimination of approximately 890 IT jobs most at company headquarters in Bloomington, Illinois.
It should surprise nobody that a company spokesperson wrote, “Just like any business, we must continually look for ways to evolve towards the future and serve our customers in a more efficient way. Reviewing and adjusting our processes, departments and facilities helps position the company and its employees for the future and remain strong for State Farm policyholders.”
Fate has not been kind to State Farm who reportedly suffered a property-casualty pretax operating loss of $1.7 billion in 2017 mostly attributable by a $6.5 billion underwriting loss caused by “significant catastrophe losses,” including the historic wildfires in California and hurricanes Harvey and Irma in the South.
This is not the only mass State Farm layoff as the company has indicated that it would not be renewing the lease on its 12-story building in Tacoma, Washington and that 1,400 employees will be affected as State Farm exits its two Tacoma Operations Centers. According to company spokesperson Sevag Sarkissian, “We plan to fully exit the two Tacoma Operations Centers by end of 2018. Employees ‘may have’ the opportunity to apply for jobs in other State Farm locations.”
Are you asking yourself, Am I Next?
