Universal Studios Laying Off Workers to Cut Costs

As part of a goal to slash $250 million from its budget, Universal Studios has begun laying off workers as its cash-strapped parent company continues to put the squeeze on its American entertainment businesses.

Universal this month has cut more than two dozen workers, including plumbers, electricians and office staff, as part of a plan to cut its budget by 10%.

The Hollywood film studio and theme park company also intends to slash executive bonuses by as much as half while continuing to reduce marketing and movie production expenses. Universal also may sell its Universal City Plaza tower, sources familiar with the cuts said.

The studio, which employs about 5,000 at its lot in Universal City, is weighing whether additional layoffs and cuts will be needed, sources said.

A Universal Studios spokeswoman declined to comment.

Christine Page, business representative for the Local 174 office workers union, said employees at Universal are fearful, “just waiting for the other shoe to drop. We don’t know if there will be” more layoffs.

The cost-cutting moves are part of continuing belt-tightening throughout Vivendi Universal, which has been selling assets to reduce debt and has cut hundreds of jobs at its headquarters in Paris and New York.

The owner of Universal Studios recently put three of its corporate jets up for sale and is shedding an art collection and a luxury Manhattan apartment.

The cuts come several months after Vivendi Chief Executive Jean-Rene Fourtou gave his American executives a directive to cut expenses and generate more cash. Fourtou, who wants out of Hollywood in order to refocus Vivendi on the telecom business, is said to be preparing Universal for a public stock offering or an outright sale.

Much of the cost-cutting measures have been pushed by Barry Diller, co-chief executive of Vivendi’s U.S. entertainment group, and his lieutenant, Victor Kaufman.

Theme park workers aren’t included in the latest round of cuts, sources said.