New Round of Layoffs at American Funds' Parent
Capital Group expects 820 staff cuts; no investment professionals included in layoffs.
Capital Group, parent of American Funds, has announced its third round of layoffs since last fall, telling employees to expect 820 staff cuts by June 12. The firm reports that among those cuts will be employees working for American Funds Distributors Group in Hampton Roads, Va. This division works with financial advisors and also sells American's retirement plans. Previous cuts included some of the firm's overseas staff.
Company spokesman Chuck Freadhoff has indicated that no investment professionals are included in the layoffs and that American Funds continues to operate with a complete analyst staff. No investment professional were included in the previous two cuts either, and the firm has also gone through its normal round of annual hiring of investment professionals. Freadhoff noted to us that, despite the recent market runup, the firm had built a distribution staff commensurate with a $1.2 trillion asset base and anticipated growth.
We're pleased that American has not cut investment staff, and see no reason for investors to view the funds in a dimmer light.