United States-Caterpillar Tractors lay off 20,000 staff in recession.

UNITED STATES-CATERPILLAR LAY OFF 20,000 STAFF.

Despite posting record revenues of $US51 billion for 2008, machinery giant Caterpillar has announced it will be sacking 20,000 employees to save itself from the effects of the global financial crisis.

"These are very uncertain times, and it’s imperative that we focus Team Caterpillar on dramatically reducing production schedules and costs in light of poor economic conditions throughout the world," Caterpillar chairman and chief executive officer Jim Owens said.

"While it’s painful for our employees and suppliers, it’s absolutely necessary given economic circumstances."

The company says its headline figures belie the true state of its situation.

While revenues were up 14pc from 2007, profit after tax was $US3.5b - flat with 2007.

"While 2008 was our sixth consecutive year of record sales and revenues, it was an extraordinarily challenging year," Mr Owens said.

"Through the first three quarters we experienced booming demand from key global industries, notably mining and energy, and most emerging markets.