1,550 people were laid off today at GE Transportation, the region’s largest employer. 350 of the positions will be permanent, and the other jobs may be called back as work warrants.

If you were one of the people laid off today at GE or perhaps a friend of family member was, our thoughts are with you. This is a huge blow to our community.

GE stock closed at 11.62, down 1.02 on the day (an 8% drop).

GE’s statement on today’s layoffs:

GE Transportation notified employees and union representatives today of its intention to institute reductions in force across its operations during 2009. Reductions will be made through a combination of early retirements, attrition, restructuring and layoffs.

The announcement comes amidst a global economic slowdown leading GE Transportation to contend with shrinking freight volumes of U.S. railroads, order cancellations or delays, decreasing production volumes in 2009, cost pressures, margin erosion, as well as fierce global competition. The economic environment prompted GE Transportation to implement aggressive cost cutting and containment measures starting in the third quarter of 2008.

“The overall economic downturn is substantial and we at GE Transportation are not immune to the global recession,” said Lorenzo Simonelli, President and CEO of GE Transportation. “In order to stay competitive and ensure our future success, we must bring our cost structure in line with our current fulfillment needs and the softenin g global market.”

GE Transportation’s locomotive production volume at its manufacturing plant in Erie, PA, is currently projected to be more than 40% lower in 2009 than in the previous year. In addition, more than 50% of GE Transportation’s current locomotive backlog is slated for 2010 and 2011. Workforce reductions will be taken over the course of 2009 and primarily impact GE Transportation’s largest manufacturing site located in Erie, PA. The announcement pertains to permanent Lack of Work (LOW) and Temporary Lack of Work (TLOW) actions. Permanent Lack of Work (LOW) actions will affect approximately 150 salaried and 200 hourly employees.

The company also announced a Temporary Lack of Work (TLOW) action affecting 1,200 hourly employees.

Added Simonelli: “We recognize that these are tough actions that will impact our employees, their families and the community in which we live and work. We intend to treat each affected employee in a fair and respectful manner. We will provide a set of comprehensive benefits consistent with GE and local country practices to help affected employees make a successful transition from their jobs to retirement or other work.”

GE Transportation will offer comprehensive benefits packages for eligible affected employees based on local legal requirements and practices, including severance, income extension aid, medical, vision, and dental coverage for employees and covered dependents, life insurance coverage, as well as outplacement and career counseling services.