3M, like many other companies worldwide, is grappling with the economic downturn and has decided to cut 6,000 jobs as part of its intensified efforts to reduce expenses and revive its struggling operations. The trend of workforce reduction has been widespread due to the economic slowdown.

As part of its ongoing restructuring efforts, 3M has announced job cuts that are anticipated to result in annual cost savings of up to $900 million, according to a statement released during the reporting of its first-quarter earnings. With this recent announcement, 3M's total job cuts for the year now amount to 8,500, equivalent to approximately 10% of its global workforce.

Despite the company’s Chief Executive Officer Mike Roman's statement that these measures would streamline operations and enhance profitability, investors showed limited reaction, reported Monaycontrol. 

At 9:32 a.m. in New York, 3M's stock experienced a modest increase of less than 1%. The shares of the Minnesota-based manufacturing conglomerate, which have already declined by 12% this year, marking the poorest performance among the Dow Jones Industrial Average, did not elicit a significant response from investors. 

JPMorgan analyst Steve Tusa expressed skepticism in a research note, stating, "There have been numerous efficiency initiatives in the past, with little tangible results. This appears to be more of the same."

The recent results underscore the challenges faced by 3M, known for its products such as Post-it notes, respirators, and smartphone display materials, as it grapples with sluggish demand for consumer goods, electronics, and other items among its extensive portfolio of approximately 60,000 products. 

Additionally, the decline in sales of virus-filtering respirators after the peak demand during the pandemic, along with the uneven economic reopening in China, have also impacted the firm's performance.

The operational challenges faced by the conglomerate have further intensified investor concerns regarding potential liabilities, which could amount to billions of dollars. These liabilities are related to allegations of supplying faulty earplugs to US combat troops and contamination from persistent chemicals, commonly known as "forever chemicals", which 3M has announced plans to discontinue production of by the end of 2025.

During 3M's earnings call with analysts, CEO Mike Roman revealed that the job cuts announced this year would encompass senior executive roles and impact all businesses, functions, and regions within the company. 

Roman also highlighted the lessons learned from various challenges, such as the pandemic, supply chain disruptions, and evolving global trends, which have informed the decision-making process on what is effective and where improvements can be made.

“Our experience throughout this journey, including lessons learned during the pandemic, supply chain disruptions and changing global trends, has shown us what is working and what we can do better,” Roman said.

In addition to the job cuts, 3M has also unveiled changes in its management team. Notably, Michael Vale, a seasoned 3M veteran with 30 years of experience, has been appointed as the Chief Business and Country Officer, a newly created role within the company's operating committee. Vale will report directly to CEO Mike Roman and will be responsible for overseeing three out of the firm's four business units, revealed the same report by Moneycontrol. 

In the last quarter, adjusted earnings per share for 3M were $1.97, surpassing the estimated $1.58 forecasted by analysts. However, the company's organic sales declined by 4.9%, which was lower than the expected 6.9% decrease projected by Wall Street. 

Despite the decline, it is worth noting that this was the largest drop since the second quarter of 2020, when the global economy was severely impacted by the pandemic and came to a standstill.

3M has reaffirmed its annual forecast, projecting a potential decline in organic sales of up to 3% and adjusted earnings of up to $9 per share. In January, the company had already revealed plans to cut 2,500 manufacturing jobs in response to the challenging demand environment, which is part of a series of restructuring efforts initiated since CEO Mike Roman took office in 2018. 

The announced restructuring actions for this year are expected to result in pretax charges of up to $900 million, according to the company's statement.