GEICO laying off around 120 staff members in Melville
GEICO announced layoffs Thursday. Credit: SOPA Images/LightRocket via Gett/SOPA Images
GEICO announced it was laying off 2,000 people nationwide Thursday in a move that is expected to impact about 4% of the firm's Melville workforce, GEICO said.
Newsday reported in 2020 that the Maryland-based insurance company employed 3,700 in the region and wanted to hire another 175 workers. It's unclear how the head count may have changed in recent years, and GEICO didn't respond to questions about how many it employed in the area.
In a memo sent to employees Thursday, GEICO chairman and CEO Todd Combs said the company took steps to deal with a "very difficult period" in the industry. He listed several challenges, including high inflation, growing medical costs and longer repair times.
"Our future requires our company to adapt swiftly and evolve our business model when needed to stay competitive and win," Combs said in the memo.
He wrote that GEICO would inform about 2,000 associates across the U.S. Thursday that they were being laid off. That's about 6% of the company's total staff.
"This will allow us to become more dynamic, agile, and streamline our processes while still serving our customers," the memo said.
Combs added that GEICO will be increasing the amount of time employees spend together in the office and aiming to complete that transition on Jan. 1. Company leaders will share the number of days workers must spend in the office, which may vary by department, he said.
The insurance company sold a 239,000 square-foot building in Woodbury to the Christian Congregation of Jehovah's Witnesses late last year, the religious group said. Around that time, GEICO committed to 200,000 square-feet of workspace at Huntington Quadrangle 1, according to Tony Fromer, principal at We're Associates, which owns the development. The firm has yet to move into that location, he said.
GEICO has long leased about 75,000 square-feet at Huntington Quadrangle 2, Fromer said.
Based on the most recent employment figures available, the layoffs could hit more than 120 local workers. That wouldn't significantly impact the regional economy, but of course, would be quite significant for those impacted, said John Rizzo, an economist and Stony Brook University professor.
The insurance company, which is owned by Warren Buffett's Berkshire Hathaway, will offer those being let go career coaching, help updating their resume and other transition resources, the memo said.
The downsizing underscores why the town of Huntington is mulling transforming the Route 110 office corridor with more mixed-used development, Town Supervisor Ed Smyth said.
"We're working on a redevelopment plan that we believe will not only provide a diverse housing stock, but attract new businesses to the town," Smith said.
Sarina Trangle covers affordability and cost of living issues and other business topics. She previously worked as an editor and reporter at amNewYork.
