Atlanta, March 6Reuters)-
Chairman of construction products manufacturer Masco(MAS. N)
Cutting 8,000 jobs, he said on Tuesday that he expects to rise with the U. S. unemployment rate. S.
A slowdown in the housing market has put pressure on businesses.
"I think the situation is worse than what you see," said Richard manogen, chairman and chief executive of Masco, at an investor meeting on the Internet.
"I think you will see an increase in unemployment, and I think it will have a positive impact on commodity costs and on interest rates, because I think once they see a weak economy, the Fed will act, "added Manoogian.
Manoogian reiterated that cabinets, Behr paint and Delta faucet maker Tyler, Michigan, are affected by the weak housing market and sales are expected to cut the company's labor force by 16% by the end of the first quarter.
40% of Masco's sales come from new homes.
"We are a company and we will lay off 8,000 people," Manoogian said . ".
"In our industry, you have increased our number many times and you can provide equipment for people and furniture users. . .
In the economy, I think, you'll see a bigger chain reaction than most people expect.
"On Tuesday, the National Association of Realtors said sales of existing properties in the United States had not yet been completed. S.
The House fell worse. than-expected 4.
1% winter weather returns with season on January.
The biggest retail customers in Masco include Home Depot. (HD. N)and Lowe’s Cos. Inc. (LOW. N)
"Significant divestiture" is expected to continue to help reduce costs.
The company has got rid of many
Core business in recent years.
For example, in 2005, the company spun off two operating companies that made bathroom vanity, medicine cabinet and other bath accessories.
"We expect some additional divestiture in 2007," Manoogian said . ".
He added that
The core business has helped the company reduce from 67 three years ago to about 31 today.
Manoogian also said that Masco may not be interested in buying Home Depot Supply, which is considering suppliers of building materials and other products for sale or divestiture.
Many of the companies included in the business are Masco customers, Manoogian said.
"I don't think it's likely that we want to get into the supply business because we're going to compete with all the wholesalers that Masco sells to," said Manoogian . ".
Shares of Masco rose 3 cents to $28.
Morning trading on the New York Stock Exchange.
Shares have fallen by about 3% so far this year.