Nestle, the largest food and beverage company in the world, has declared a major cut of 16,000 jobs worldwide by 2027 as part of a significant cost reduction and digital overhaul initiative. The relocation would constitute approximately 6 per cent of its 270,000 worldwide labor force and one of the largest layoffs in the organization.
This ruling falls under the new CEO, Laurent Freixe, who joined the company in September after Mark Schneider abruptly resigned. As Nestle has explained, the restructuring will enhance efficiency, sales growth, as well as adapt to the swift automation trends. Approximately 12,000 white-collar jobs will be eliminated or transformed by AI and digital technologies; it is the direction in which the company moves towards, and automation of its finance, human resource, and supply chain processes.
Nestle said its revenues fell by 1.9% to 65.9 billion Swiss francs during the first three quarters of 2025 because of inflation and reduced consumer spending, which affected demand. Nevertheless, its share increased by almost 5 percent following the announcement of the layoff, which showed that investors trust the new cost-cutting initiatives.
The company said that it will be central to its turnaround plan of automation, and the expected results of AI-based systems will be less operational costs and faster decision-making. Nonetheless, the layoffs have led to an increase in job loss due to automation with Nestle reducing 16,000 employees becoming part of the increasing global trend of industries facing AI-based retrenchment.
Analysts indicate that Nestle to cut 16,000 jobs is an indication to a wider change in the consumer goods sector to AI-based restructuring. The effects will mainly be recorded in the white-collar jobs but more information is likely to be known as the plan is put in action to the year 2027.
