The company’s senior vice president for human resources, Mary O’Keefe, said the employees whose positions have been eliminated will receive severance pay and career assistance.

“The most difficult decision business leaders ever have to make is the decision to eliminate jobs,” O’Keefe, said in a prepared statement. “Since September when market conditions worsened, we have been continuously reviewing expenses and expected revenues. In order to bring expenses more in line with projected revenues, we have already cut many expenses. Unfortunately, this must include eliminating some jobs.”

The Des Moines-based insurance and financial services company employs more than 16,000 people worldwide and 8,000 in Central Iowa.

The financial services company, which has more than 8,200 employees in the Des Moines area, told the Iowa Department of Economic Development that the current economic downturn made the job creation goal attached to $2.7 million in tax credits very challenging.

The financial crisis roiling U.S. and overseas markets has hit national insurers like Principal Financial hard. In November, the Des Moines-based company reported its third-quarter net income declined 61 percent from the same quarter a year earlier. The nation’s largest 401(k) administrator said its net income included losses of $156 million, largely because of charges from holdings in bankrupt Lehman Brothers and Washington Mutual.

Over the past two months, Principal’s share price has fallen 66 percent. On Monday, its stock fell $1.83 to close at $15, the lowest price since the company went public in 2001.

Principal’s plans originally called for adding 1,500 employees in the next 3 to 5 years. The company said that growth now depends on improvements to the overall economy.