Stryker Corporation, a Michigan-based medical device company with operations around the world, is laying off five percent of its employees in order to offset the cost of a tax passed as part of Obamacare in 2009 and scheduled to take effect in 2013.
"The targeted [employee] reductions and other restructuring activities are being initiated to provide efficiencies and realign resources in advance of the new Medical Device Excise Tax scheduled to begin in 2013," Stryker announced in a November 10 press release, "as well as to allow for continued investment in strategic areas and drive growth despite the ongoing challenging economic environment and market slowdown in elective procedures."
Industry executives believe that the 2.3 percent tax will cost $20 billion in revenue over ten years. "If this tax is implemented in 2013, it will undermine our industry's ability to create and maintain good jobs in the U.S., and worse, will lead to higher costs for patients, undercutting one of the primary goals of health care reform," the head of a major medical device industry trade group warned in July.
Stryker CEO Stephen MacMillan hinted at such a response to the Obamacare provision in September. "There is no doubt that we're already starting to think about actions that offset that additional tax," he said at a conference, according to MassDevice.com. ""Here we are, one of the greatest industries in the country, and we're staring down on January 1st, 2013 and the addition of a 2.3 percent excise tax, while meanwhile on the other side all the discussion in Washington is about creating jobs," he added.