Nov. 14 (Bloomberg) -- Fidelity Investments, the world’s largest mutual-fund manager, will eliminate about 1,700 jobs in the first three months of 2009, adding to dismissals that started this week as it confronts an eroding asset base.

Together, the two rounds of job cuts represent 3,000 employees, or about 7 percent of the company’s 44,400-member workforce, Anne Crowley, a Fidelity spokeswoman, said in an interview today. No decisions have been made on which divisions will dismiss employees or whether fund managers and research analysts will be affected, she said.

“All we have finalized is the number of employees” who will be affected, Crowley said.

The biggest market losses since the Great Depression and investor withdrawals have slashed assets at money-management firms, leading to more than 3,500 firings so far. Janus Capital Group Inc., AllianceBernstein Holding LP, Legg Mason Inc. and Morgan Stanley’s asset-management group also plan to cut jobs.

The global market selloff has reduced Fidelity’s assets under management this year by about 13 percent, to $1.4 trillion from $1.6 trillion through Sept. 30. Stock and bond mutual-fund assets fell 23 percent to $717 billion in the first nine months, according to Financial Research Corp. of Boston.

The firings are bigger than Fidelity’s cutbacks in 2002 following the collapse of the Internet-technology stock boom, when the company eliminated 1,695 jobs, or about 5 percent of its staff.

Prioritizing Savings

Fidelity President Rodger Lawson has made expense reductions a priority since joining the company in July 2007 from Prudential Financial Inc. Fidelity, which has been trimming jobs for at least the past year, employed 46,000 people in June. It has been trying to offset declines in its mutual-fund unit by expanding its brokerage unit, corporate-benefits and institutional- investment divisions.

Employees who were dismissed as part of the first round were notified on Wednesday and will stop work after today, Crowley said.

They will remain on the payroll through Dec. 31, and after that will get a “generous severance,” she said, declining to be more specific.

To contact the reporters on this story: Sree Vidya Bhaktavatsalam in Boston at sbhaktavatsa@bloomberg.net.

Last Updated: November 14, 2008 17:27 EST