Cat bleeds bright yellow

Caterpillar has spoken, rather decisively about the current economy. The company said it will cut 20,000 jobs in an attempt to "deal with a very challenging global business environment." The manufacturer will cut roughly 4,000 production employees and around 7,500 management and support staff. About 8,000 of the job cuts will come from contractors not directly employed by the company. The 12,000 direct cuts equal about 11 percent of the company's total workforce. Caterpillar currently employs about 113,000 workers.

"These are very uncertain times, and it's imperative that we focus Team Caterpillar on dramatically reducing production schedules and costs in light of poor economic conditions throughout the world," Caterpillar CEO Jim Owens said in a statement. "While it's painful for our employees and suppliers, it's absolutely necessary given economic circumstances."

Caterpillar's announcement came on the same day it reported record sales and revenue of $51.3 billion for 2008. Fourth-quarter earnings, however, fell 32 percent on a sharp decrease in demand for construction services in the past three months.

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