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4/4/2004

Ups and downs at Kodak

The Associated Press

ROCHESTER, N.Y. — For Jackie Wiseman, a 27-year Eastman Kodak Co. veteran who expects to lose her job soon, it was a case of a little sadness followed by a little glee.

Friday was Bonus Day at the venerable photography company, the springtime rite when its vastly reduced American work force divvied up a one-time payout of $66 million.

Founder George Eastman launched the “extra pay for extra good work” annual dividend in 1912.

The ritual celebrations — and the size of wage bonuses — are nothing like they once were.

But the muted mood was dampened further by word Thursday that, after 74 years, Kodak was being kicked out of the Dow Jones industrial average, corporate America’s most exclusive club.

“It’s just another bit of sad news,” Wiseman, a clerical worker, said during a smoke break outside Kodak’s yellow-brick headquarters. “But things have been so changing at Kodak that this is really just more of the same, just another couple of days.”

Wiseman, 48, a single parent with two teenagers, fondly recalled Bonus Days of years past when Kodakers flocked to auto dealerships, furniture stores and bars to splurge and frolic.

“The town was much more up — there used to be TV stations at the bank!” she said. “I used to have much more fun with it, take vacations to California, Myrtle Beach. I just pay bills now. The supervisor did bring in muffins and fruit but it’s kind of more quiet.”

The performance-based bonus, distributed among 27,300 U.S. employees, equaled 4.3 percent of base pay, or an average bonus of $2,417 a person.

It jumped up to $110 million last year after plunging to $32 million in 2002 — the lowest since 1934, when no payout was awarded.

Kodak has a plant in Windsor that makes paper and ribbon for digital photo kiosks, motion-picture film and medical imaging products.

Last month, the company said it would send about 60 new jobs to the plant, boosting a northern Colorado region that has bled high-tech jobs for several yers.

Kodak, once a symbol of American ingenuity, is battling through a wrenching transition from film to digital photography. An additional 12,000 to 15,000 jobs will be axed over the next three years, slimming its worldwide work force to World War II-era levels of around 50,000.

Wiseman expects to be one of the casualties later this year in Kodak’s hometown.

“I’ll work here as long as I can, I don’t plan on leaving,” she said. “There’s still optimism — we just look at it a little less naively. I think that they’re going to make it with the digital. It would be nice to get some gusto back in here.”

Getting ejected from the 30-stock Dow index, along with AT&T Corp. and International Paper Co., didn’t help. Loss of membership in the fabled club might be a prestige blow, but analysts don’t expect it to alter Kodak’s prospects of surviving the swift onset of digital imaging.

“Our membership in any index hasn’t any bearing on our ability to manage the company successfully,” said Kodak spokesman Gerard Meuchner.

Rod MacKenzie, 52, a network engineer at Kodak, sees the ouster as “symbolic but not substantive.”

“It’s sadder for me — I used to work for AT&T,” he said. “However, these are times of entropy. Events like this aren’t surprising.”

Asked if he remembered it was Bonus Day, MacKenzie deadpanned: “I heard a rumor.”

“It’s nothing special,” he said. “I just stick it in the bank. People are more concerned about their jobs, and they tend to take Bonus Day with a grain of salt. Our group is more jaded. We’re too unsentimental to do rituals.”

In contrast, systems analyst Joe Marusak, 45, was accompanying a cheerful Kodak clique on a lunch outing.

Though he was “indifferent” about Kodak’s exit from the Dow index, Bonus Day brought a lift.

“It’s a different day for sure,” he said, grinning. “It’s another check in the pocket.”