Siemens AG announced today that it will eliminate 16,750 jobs, or 4.2 percent of its global workforce, in an effort to reduce costs by 1.2 billion euros by 2010 in wake of an economic downturn.

“The speed at which business is changing worldwide has increased considerably and we’re orienting Siemens accordingly,” said company President and CEO Peter Löscher, in a release. “Against the backdrop of a slowing economy, we have to become more efficient.”

The Munich-based company will cut 12,600 administrative jobs and another 4,150 positions as a result of restructuring projects. About 5,250 of the jobs cut will be in Germany.

Siemens said it would look at options such as company transfers and part-time preretirement schemes to avoid forced layoffs.

It also is cutting costs by other means, such as reducing expenditures for information technology infrastructure and consultants. The managing board has been reduced from 11 members to eight and its units consolidated into three sectors – energy, industry and healthcare – from eight. By 2010, the number of Siemens’ legally separate entities will be reduced to fewer than 1,000 from about 1,800.

The company opened a wind turbine blade facility in Fort Madison last year.