MEMPHIS, Tenn. — As markets opened Friday, Memphis-based FedEx had all the attention with a recent tumble in its stock price, fueling fears of a recession.
But at least two analysts said FedEx jobs in Memphis metro area, where the shipping giant employs an estimated 30,000 in the world hub and corporate offices, are probably safe.
Shares of FedEx plunged 22.8% Friday, putting the company on track for its biggest single-day sell-off on record, the Associated Press reported. The Dow Jones Industrial Average fell 293 points, or 1%, and the Nasdaq fell 1.4%.
“The FedEx headline was the one that got this ball rolling,” said Jonathan Corpina, senior managing partner with Meridian Equity, from the floor of the New York Stock Exchange. “This was the headline pulling our markets lower.”
Earnings announcements for the international shipping giant missed the mark, prompting planned closures, reduced flights and belt tightening. The company said it will close 90 FedEx Office locations and five corporate offices.
“What this news is showing to us is that supply chain issues, labor issues, inflation, interest rates, all of this put together is looking to have a significant impact,” Corpina said.
He says FedEx is the latest example of a company having challenges in the worldwide economy.
“The fear of a recession continues. Companies are preparing for the next months and quarters ahead to manage cost cuts,” Corpina said.
Despite the threat to the economy as a whole, Corpina downplayed the immediate impact on jobs within the company.
“No, I don’t think many people will lose their jobs,” he said.
Dr. John Gnuschke, former University of Memphis business educator, put the announcement in perspective. He said FedEx employees will probably be safe, but he can’t say the same for contractors and other logistics companies in our area.
“All of those links are impacted by this decline,” Gnuschke said.
Still, he said he thinks FedEx will bounce back. Both experts say pay close attention to how the company hires during the busier holiday season.
FedEx has not addressed layoffs.
FedEx, based in Memphis since 1973, is a Fortune 100 company and is the largest private employer in the metro area. With revenue topping $69 billion, FedEx was the largest publicly traded company in Tennessee in 2021, according to Statista.