DATE: Thursday, October 9, 1997             TAG: 9710090830

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY MEREDITH COHN, STAFF WRITER 

DATELINE: CHESAPEAKE                        LENGTH:   82 lines

HOUSEHOLD CREDIT LAYS OFF 100 WORKERS IN CHESAPEAKE COMPANY SAYS SAYS ITS FIRST-EVER LAYOFFS WERE NECESSATY TO INCREASE PROFITS.

About 100 employees were laid off this week at Household Credit Service of Chesapeake, a company that many employees believed never would lay them off.

``They kind of preached it, and there was pride there had never been a layoff,'' said Dennis Whitehurst, a manager whose 7 1/2 years at the company ended Tuesday. ``When you see there is no loyalty, it gives you a bitter taste.''

A spokeswoman for Salinas, Calif.-based Household Credit said another 100 jobs were cut at the company's Las Vegas branch and at its headquarters. Further work force reductions were made at Household Credit's parent company, Household International Inc., in suburban Chicago.

Ellen Rosenfels, marketing director for Household Credit in Salinas, said the move is a corporate-wide effort to improve profitability.

``We've been very fortunate in the past and seen tremendous growth so we've never had to lay off anyone,'' she said. ``But we're in the most competitive period in history, and we, like other consumer service companies who've been laying people off, haven't experienced expected growth.''

While Rosenfels said the company has not reached expectations, it is doing well.

Prospect Heights, Ill.-based Household International has 700 offices in the United States, United Kingdom and Canada. The parent company and its subsidiaries, including Household Credit, provide financial services such as home equity loans, credit cards and corporate and acquisition finance lending.

Household Credit built its 120,000-square-foot building in Chesapeake's Crossway's Center Commerce Park in 1989. Since then, it has expanded three times, bringing the number of employees to about 1,400 before the layoffs. Most work in customer service and collections.

Analysts said Household International has had consistent gains, and third-quarter earnings were expected to rise 22 percent from a year earlier. Its stock closed Wednesday at 118.4375, down 1.375.

``We think they are in good shape,'' said analyst Jeffrey K. Evanson, of Piper Jaffray, a Minnesota brokerage. ``Part of how they stay in good shape is through expense management. Sometimes that means shutting down operations that are not up to expected performance.''

Cutting expenses sometimes means layoffs, he said.

Household's Rosenfels said a number of criteria were considered in choosing employees to let go, but she did not elaborate. All were offered help finding new jobs and severance pay based on length of time at the company, she said.

Some employees said the layoffs came with no warning Monday and Tuesday after they had worked partial or full days. Some said they were told the company was downsizing, and at least one said he was told it was performance related. All said they were asked to leave immediately.

Whitehurst said that, during his seven years at the company, he'd worked his way up from a part-time phone representative to supervisor in the Bad Phone Group. He often worked long hours because, he said, he liked his job, which was to find phone numbers for people who had a debt to the company.

He has a wife, two kids, a house in Chesapeake and, now, a newly printed resume, he said.

``They called me in at 3:30 p.m. and said there was going to be a reduction in work force, and that was it,'' said Whitehurst, 41, who normally works from 7:30 a.m. to about 6 p.m. He said he's expecting severance pay totaling about 12 weeks, but he'd rather have his job back.

Another dismissed employee said some people were crying as some of their colleagues collected their belongings in plastic trash bags.

Jim Vandenbosch, 27, said he heard a rumor about layoffs and knew he was on the list when he was led into a supervisor's office soon after arriving at work Monday afternoon. He was told that he was being fired because of one bad evaluation.

Vandenbosch, who was employee of the month last October, said the evaluation was unrelated to his productivity. But he believes it led to a recent demotion and the firing. He said he's considering legal action against the company.

Vandenbosch had cut back to part-time work so he could attend school. He will continue at Old Dominion University, where he is in a pre-medicine curriculum, and will begin looking for another job that offers evening hours and can match his wage of $12.20 an hour.

``I'm very worried; I was already living paycheck to paycheck,'' said Vandenbosch, who has a house in Virginia Beach, a wife and four kids.

``As a supervisor, I used to tell people that the company had never laid anyone off,'' he said. ``That was always a question people asked. I never hesitated to respond.'' KEYWORDS: LAYOFFS

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