Caterpillar Inc will cut 20,000 jobs—or 18% of its workforce—after posting a 32% drop in fourth-quarter income, the Wall Street Journal reports. “We were whipsawed in the fourth quarter,” said CEO Jim Owens. “Key industries were hit by a rapidly deteriorating global economy.” The manufacturer of heavy machinery is often seen as an indicator for various parts of the economy, particularly construction.
Over the past five years, Caterpillar’s workforce has ballooned nearly 50% as demand overseas drove growth. The company still posted a profitable fourth quarter and, Owens boasted, 2008 was the company’s sixth-consecutive year of record sales and revenue. But it expects first-quarter profits to be “under severe pressure.” The company has long been averse to job cuts, and last month announced up to a 50% cut in executive pay.