Ikea plans more job cuts and brake on growth amid crisis

The economic crisis will take a further hard toll on staff at Ikea worldwide, with massive further job cuts in the pipeline, the group's billionaire founder said today.

Ikea is facing up to a savage decline in global consumer spending on home furnishings — spending that is heavily dependent on the number of people moving house or remortgaging.

It has so far cut staff by 5000 and is scaling back its expansion programme "significantly", Ingvar Kamprad said. Still an adviser to Ikea, he added: "It is naturally a disappointment, but it will unfortunately not be enough. It will be necessary to do significantly more on the staff side.We need to cut staff more mainly within manufacturing and logistics. This is about adapting to sales being far below budget, as well as becoming more efficient."

Kamprad also said the group has scaled back expansion plans, and criticised the current management for not acting soon enough.

He said: "The forecast shows the margin and earnings falling considerably this year. That is proof that we've been too lax in dealing with our existing stores. I've tried to warn for some time that we've had too much focus on expansion and now the board has chosen to reduce the pace of new establishments," he told Swedish newspaper Dagens Industri.