Fidelity Investments will lay off roughly 250 people, including about 100 in Massachusetts, as part of a restructuring of the Boston mutual fund giant that began last fall, a spokeswoman said.
The company, which informed affected employees yesterday, will eliminate technology jobs and positions at two investment units that are merging, said spokeswoman Anne Crowley.
"The recent merger of our workplace investing and retail divisions created opportunities to reduce some duplication and align resources," Crowley said.
The layoffs are small in number in comparison to Fidelity's total workforce of 46,500, including 12,700 Massachusetts employees at the end of December.
The cuts come amid questions surrounding the future leadership of the closely held company, which is largely controlled by 77-year-old chairman and chief executive Edward C. "Ned" Johnson III and his family. Last year, Johnson replaced top managers and drew concern for not publicly disclosing a succession plan.
Fidelity is among the world's largest financial firms, with $1.4 trillion in assets under management at the end of 2006.
Crowley said the layoffs were made at the decision of individual unit managers, however, and were "not part of a corporatewide layoff policy."
Most of the roughly 100 layoffs in Massachusetts will be of employees based in Boston, Crowley said, and will include workers who previously were part of an organization known as Fidelity Employer Services Co., or Fesco. Based in Marlborough, Fesco handled 401(k) savings accounts, payrolls, and healthcare arrangements for corporate clients.
Fesco was split apart as part of a restructuring begun in the fall by Fidelity's new president, Rodger Lawson, who has stressed cost control as a way to lower prices for customers, including those who pay fees on mutual funds.
Many analysts had expected some cuts after Lawson distributed an internal memo in September that declared: "Pricing is a weapon. Expense discipline keeps it sharp."
The restructuring put Fesco's payroll and healthcare work into a new Human Resources Services organization headquartered in Marlborough. Johnson's daughter and possible successor, Abigail P. Johnson, who previously ran Fesco, now oversees the Personal and Workplace Investing group, which includes 401(k) plans, product marketing, and retail phone and branch operations. Lawson also brought in a new leader to oversee units including Fidelity's technology group.
Eric Kobren, executive editor of the independent Fidelity Insight newsletter, said he was not surprised by the job cuts, but regards them as an attempt to find efficiencies rather than a sign that Fidelity's business is suffering.
"I think they're gearing up for growth," he said yesterday. Moody’s Investors Service noted in a report in November that the company’s profit rose for the first half of the year.
Crowley said last year was one of the company’s best overall. Employees whose jobs are eliminated will be provided with outplacement services, severance benefits, and the opportunity to apply for other jobs within the company, she said.
Yesterday’s cuts come on the heels of Fidelity's laying off of 200 employees in November. Overall, though, Lawson has continued to expand the firm, up 4,500 last year. In January, Fidelity outlined plans for a new facility in New Mexico that will eventually employ 1,250 people as part of the new human resources business.
That state provided economic incentives to lure Fidelity jobs, as have other states, including Florida, Texas, and North Carolina. Fidelity has also cited a goal of locating facilities closer to its customers. In 2006, it said it would move as many as 1,500 Massachusetts jobs elsewhere, including to New Hampshire and Rhode Island - job shifts that are still underway, Crowley said.
The growth of jobs in other states has created angst among some workers and development officials in Massachusetts. Though the state still accounts for the company’s largest concentration of people, its employment level has stayed stable in recent years.
Ross Kerber can be reached at kerber@globe.com.
