Insurer to cut 227 jobs in state Nationwide to move work from Annapolis to Gainesville, Fla.

October 17, 1995|By KIM CLARK | KIM CLARK,SUN STAFF

Nationwide Insurance announced yesterday that it would eliminate 227 processing and claims jobs at its Annapolis office over the next seven months, and move the work to Gainesville, Fla.

The Columbus, Ohio-based insurer said the layoffs would begin next month.

After its completion in May, the consolidation will leave Nationwide with about 165 employees in Annapolis and another 300 elsewhere in the Maryland, the company said.

The news came as a surprise to Anne Arundel County officials, who said they knew the company was planning to restructure but didn't expect layoffs in Maryland so soon.

"This is not good news," said Rosemary Dugg, a spokeswoman for the Anne Arundel Economic Development Corp.

Ms. Dugg said Nationwide had told her and other economic development officials several months ago that it was considering either moving Maryland jobs to Gainesville or Gainesville jobs to Maryland. But she said the company had indicated that no decision would be made until at least next year.

"They did not tell me why" Florida was chosen over Maryland, Ms. Dugg said. "We didn't realize a contest was on."

Chuck Porcari, spokesman for the state's Department of Business and Economic Development, said he believes the decision was "purely a corporate decision" and that the company had not contacted the state about its choice.

Nationwide officials said yesterday that after 44 years of pursuing a policy of decentralizing -- putting processors close to customers -- the company had started to consolidate because of efficiencies created by computers and other technological improvements.

The announcement appears to be part of a trend toward consolidation and moving jobs south that is affecting the entire insurance industry.

On Friday, for example, State Farm Insurance Co. announced it would eliminate payment processing jobs currently in Frederick and move the work to the South.

State Farm spokesman Steve Vogel said yesterday that company hasn't yet determined exactly how many jobs would be lost in Maryland, but that he expected it would be "a few dozen . . . at the worst case, 100."

But he noted that the company is considering moving other jobs to Frederick, so Maryland may gain up to 100 other jobs.

Nationwide announced last year that it would start a company-wide restructuring, and said earlier this year it would eliminate more than 200 jobs in New Hampshire and Tennessee.

And yesterday, the company announced it would eliminate 150 jobs in Butler, Pa., and 274 jobs in Syracuse, N.Y.

To replace all the layoffs, the company said it would create 300 jobs in Columbus and 260 jobs in Gainesville.

That means the company will have a net loss of about 400 positions.

Nationwide said it may transfer some of the affected employees to Gainesville or Columbus, and would offer a `loyalty` bonus to some employees who remain until the end.

In addition, it promised to "make every effort to assist affected employees in their search for new job opportunities."

Company spokesman Bob Sohovich declined to say yesterday exactly what assistance, bonuses or severance employees would receive, or why the company had chosen Gainesville over Annapolis.

But, he said, he didn't expect any more layoff announcements.

"I think this will be it for the foreseeable future," Mr. Sohovich said.

The Annapolis office, which opened in 1952, will continue to serve as Nationwide's sales-claims underwriting headquarters for Maryland and the District of Columbia, the company said.

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