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Fewer Disney employees whistle while they work

  • Story Highlights
  • One Disney employee recognized for decades of service, is laid off next day
  • Laid-off employees reluctant to talk for fear of jeopardizing severance packages
  • Orlando area hotels also hit hard by dropoff in business
  • Disney spokesman says company downsizing like many other U.S. firms
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By John Couwels
CNN
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ORLANDO, Florida (CNN) -- Disney World has not been the happiest place on Earth for employees this year.

Disneyland in California has seen its share of layoffs as the company undergoes restructuring.

The Walt Disney World resort in Orlando, Florida, has lost some 1,600 jobs.

Imagine one day receiving recognition for decades of service from your employer only to be laid off the next day. That is what happened to one Walt Disney Parks and Resorts employee who asked not be identified.

Disney has eliminated 1,900 U.S.-based positions since mid-February. Some 900 salaried employees working at Disney's theme parks in Florida were laid off, and 700 open positions were eliminated, said communications Vice President Mike Griffin. In California, 200 workers were laid off and 100 open positions were cut.

Disneyland in California and Disney World are having their behind-the-scenes operations combined in a restructuring, said Griffin. Disney officials say theme parks, the Disney Cruise Line, Disney Vacation Club and off-property resorts have seen some people with decades of experience laid off during the restructuring.

The former employee let go after decades of service is still hoping to return once the economy improves. Several other employees said they did not want speak to CNN in fear of jeopardizing the generous severance packages offered by Disney.

Employees let go will receive pay for 60 days; extended medical coverage; and severance packages that vary according to their years of service, said a Disney source. Disney's Griffin said: "These decisions were not made lightly, but are essential to maintaining our leadership in family tourism and reflect today's economic realities."

Central Florida's unemployment rate is 9.7 percent -- a 33-year high, according to the area's job service agency, Workforce Central Florida. The rate is more than double from the same time a year ago.

The job agency's spokeswoman, Kimberly Cornett, said 40,000 to 50,000 people registered with the agency are vying for 1,000 jobs available through Workforce Central Florida. Fewer than 100 available job listings are in the tourism industry.

Cornett said she does not believe Disney's layoffs will have a significant effect to the area's overall economy, since currently 107,000 people are unemployed in Central Florida. Cornett said, however, that the effect would be huge for those laid off.

Orlando area hotels have been hit hard, too, with fewer tourist and business travelers. Orange County reported in February it collected 29 percent less revenue in a hotel bed tax in comparison to a year ago, said Brian Martin of the Orange County Convention and Visitors Bureau.

Martin said the large drop is due to fewer booked hotel rooms at reduced rates to attract visitors.

The convention and visitors bureau, in a survey of area hotels, has found companies are traveling less for meetings in Orlando. The hotels report that in the first two months of 2009, some 114 small business meetings were canceled, with $26 million in lost revenue.

Martin said the White House is partly to blame for the dropoff in business meetings. President Obama said companies that receive taxpayer bailout money should not use the money to "go take a trip to Las Vegas."

"When the president said 'don't travel,' business travel has been affected," Martin said. Las Vegas is the country's most popular convention destination, with Orlando No. 2.

Orlando has not seen any large convention cancellations in 2009, the convention bureau says.

Statistics from 2007, the latest available, show that even if Orlando saw a 10 percent drop in visitors, nearly 44 million people would still come to the city.

Disney's 2008 financial report showed income was down last year. Disney would not comment on whether park attendance was up or down. A source within Disney said that even though the theme parks are crowded, customers are not buying.

Disney's Mike Griffin said: "We continue to work through our reorganization and manage our business based on demand."

Griffin said the corporation's reorganization has been under way since 2005 and many of the recent positions eliminated would have eventually been cut. Due to the economy, Griffins said, the cuts took place sooner than expected. He added that Disney is downsizing just like many other U.S. businesses.

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