California's largest auto insurer, Farmers Insurance Group (FIG), plans to slash hundreds of jobs in a bid to streamline operations, it was reported on Friday.
Los Angeles-based FIG told employees that it would cut 554 jobs by the end of this year and that the total would reach 750 by the end of 2010, according to the Los Angeles Times.
The job cuts will affect the offices of FIG's newly acquired 21st Century Insurance unit in Woodland Hills, Los Angeles, the paper said.
The Woodland Hills complex, which had been 21st Century's headquarters until last November, currently has 979 employees.
Farmers completed its purchase of 21st Century from troubled insurance giant American International Group Inc. on July 1.
After a two-month evaluation, Farmers decided to reduce the Woodland Hills workforce as part of an effort to streamline operations, Senior Vice President Mark Toohey said in remarks published by the paper.
There was no decision on whether the firm would remain at the leased location in Woodland Hills.
Some of the displaced workers could be offered jobs at 21st Century's executive offices in Wilmington, Delaware, while others could be transferred to other Farmers operations in Southern California, Toohey said.
The job cuts come at a time when California is reeling under a 11.9-percent unemployment rate, one of the highest in the country, according to the Bureau of Labor Statistics.
This is the highest unemployment that the state has had since World War II. The national rate was 9.4 percent last month.
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