COVINGTON, Ky. -- Fidelity Investments will eliminate about 400 jobs at its Northern Kentucky campus in the next 18 months as part of a new outsourcing arrangement, employees were told Monday.
Those impacted will be employees who print and mail financial materials to Fidelity customers. That work has declined in recent years, as more customers opt for email and online delivery.
Fidelity has hired a third-party provider to take over the work, which means about 400 jobs will be impacted in Covington over the next 12 to 18 months. The Covington jobs and others now based in Grapevine, Tex. are involved in the new outsourcing arrangement with Broadridge Financial Solutions Inc.
Impacted employees will be eligible for severance and separation services.
“These job eliminations are not related to employee performance in any way,” Fidelity spokesman Perry Chlan said. “This decision is not related to Fidelity’s core financial services business, which continues to be very strong.”
Fidelity currently has more than 4,000 full-time employees at its 245-acre campus in Covington, Ky., where it established a Midwest regional headquarters in 1993. It has expanded the campus six times, most recently in 2008. Employment peaked at 4,600 five years ago. The company continues to seek new employees at Covington, where Chlan said it hopes to grow over time.
The city of Covington said the cuts will reduce the city's tax base by $441,000, but Fidelity remains its largest employer and City Manager Larry Klein is bullish on its future.
"The economy calls for leaner ships," Klein said. "If this makes them a stronger corporate entity, that's great for Covington and the region."
"The good news is Fidelity is still going to employ, even after these jobs are outsourced, about 3,500 people and they still plan to make Northern Kentucky and greater Cincinnati an important part of their region," Grayson said. "They're a great corporate citizen. They're a huge employer and they intend to stay that way."
This is the second major job loss to hit Northern Kentucky this year and both involved relocations to Texas. Toyota Motor Corp. announced in April that it would consolidate its North American headquarters in Dallas by 2017, a move that will cost Erlanger about 1,600 jobs.
WCPO's Julie O'Neill contributed to this report.
CORRECTION: Original version of this story said Covington jobs were being transferred to Texas. Fidelity says Broadridge will do the work somewhere in the U.S.