Disney revokes hundreds of workers' keys to the Kingdom in big layoffs

When it comes to the inner workings of its parks, the Disney empire can be as secretive as the Kremlin. But one thing the company is admitting is that it's firing lots of people at its theme parks. It's not discussing the exact number of dismissals except to say it's restructuring and aiming for efficiency, but by adding up reports, we can approach an understanding of the severity of the situation.

Earlier this winter, voluntary buyouts were offered to 619 executives, and 50 took the offer. One unattributed person told the Orlando Sentinel that the cuts numbered around 450, while other reports estimate closer to 800.

But if you listen to the word on the street, the figure is much higher. One former employee called it "a massacre." The situation is big news in the theme park and entertainment world. And in Florida, where Disney employs an astounding 62,000 people.

Who's not losing their jobs?

Union workers, who are guaranteed hours, job security, and wage increases. Part-time workers, too, are benefiting. Disney appears to be stealing a page from the Wal-Mart playbook, and even though it's cutting hundreds of full-timers and salaried workers, yesterday it hired 27 part-timers, who won't get overtime or full benefits. That saves money.

People who visit the Disney parks won't notice the lines being particularly short these days. They're just as long as they ever were. The problem, and a big source of the company's woes, is that people aren't spending nearly as much once they get through the gates. It seems that the company's high ticket prices have come to haunt it. Guests will pay what it takes to see the legendary resorts ($75 for a day is the going rate for one park) but they balance that by cutting back on souvenirs, food, and hotel rooms, and those are big profit-making sectors for the company.

So you're still going to wait as long as ever to ride Soarin'. But there will be fewer people running the park. Disney's fiscal second quarter ends Saturday, which is a big reason for the sudden welter of firings. The company's profits tumbled by 32% in the first quarter, so by cutting costs like this, it hopes to report less grim news for the third one.

I can't really fault Disney for this. It's always had a surfeit of employees, and part of the parks' appeal is wondering just how the company manages to do it all. I just hope that the curtailed payroll doesn't spill over to diminished customer service. Privately, employees (which Disney calls "cast members") grouse about crippling back-office bureaucracy and the herculean effort required to do something as simple as restock a popular item in a gift shop. So if this staff cull makes the Disney experience less fun in the short term, hopefully it will result in a tighter ship later on.

Update: Disney has confirmed that it cut 1,900 park workers as of April 3, a number far higher than originally estimated.
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