General Electric Co. has a new CEO focused on cost cutting. This includes a re-examination of the size of its corporate headquarters in Boston, which the company recently announced would be developed in phases.
Company officials have said new CEO John Flannery is reviewing all aspects of the business.
According to Reuters, the company has a plan to take out $2 billion in expenses by the end of 2018, and executives have been told to prepare for cuts in Boston, and in areas that don’t produce profit. According to an Aug. 31 report in the Boston Business Journal, 250 employees now work in the company’s temporary offices, part of the 800 initially planned at its permanent headquarters.
But in Providence, where the GE Digital division has plans to locate more than 100 employees in newly renovated facilities downtown, a more optimistic attitude prevails.
The company in July surpassed its initial threshold for hiring, according to the R.I. Commerce Corp. And recruitment activities are continuing.
“We’re in regular conversation with the company,” said Commerce RI spokesman Matt Sheaff. “Our understanding is they’re ahead of their hiring schedule.”
GE Digital as of late August employed more than 60 people in downtown Providence, Sheaff said.
“The company has emphasized its digital strategy remains unchanged,” he said.
A spokeswoman for GE Digital could not be immediately reached for comment.
Flannery joined GE in 1987. After a career spent in management, he was promoted to CEO after three years as the head of GE Healthcare, according to the company website. He has prioritized digital innovation, according to a recent profile in CEO magazine.
Although GE dates to a merger of energy companies in 1892, GE Digital is a new division intended to integrate its software center, global internet technology operations and commercial software. The focus is on the industrial internet, according to an overview provided by Commerce RI, which authorized up to $4.6 million in job-creation incentives to entice it to locate in Providence.
Once ongoing renovations are complete, GE Digital will occupy a floor in the Providence Journal Building on Fountain Street.
Until the new facilities are occupied, the company’s operations are located temporarily at an office building at 10 Dorrance St.
Once the new Providence employees have been in place for a year, the company becomes eligible to receive the first of its approved Qualified Jobs tax credits, according to Sheaff. Under the program requirements, jobs that qualify can generate up to $7,500 in employment tax credits annually for GE.
The cumulative total would reach $4.6 million over 10 years, assuming the company reaches the threshold of 100 employees.
Another $650,000 is available to the company through two grants from the state’s First Wave Closing Fund. They will be used to help fit out the new office space.
