Boeing reducing staff at a record pace
Boeing has been reducing staff at the fastest pace in more than a decade, the Wall Street Journal reports. During the first half of the year, the aerospace giant has parted with about 4% of its employees, most of whom have worked at large enterprises in the state of Washington.
Boeing says it must increase efficiency and more actively automate plants to build next-generation aircraft. The backlog of orders currently exceeds 5700 aircraft.
The management of the company considers cost reduction imperative to maintaining competitiveness. Airbus, Boeing’s arch rival, has in recent years controlled more than half of the narrow-body aircraft market, while a balanced duopoly has been observed for two decades.
The bulk of the reductions occurred in Washington, where two of Boeing’s three commercial aircraft assembly plants are located. The Washington Employment Service reported that 1251 people received notice of dismissal this year, and a new wave of cuts began on July 21. Over the past four years, Boeing has reduced the number of its employees in the Seattle area by more than 20 thousand people.
Seattle officials have received an emergency federal grant from the U.S. Labor Department in order to retrain laid-off Boeing employees and help them in finding new jobs.
The cuts also affected the plant in North Charleston (South Carolina). In February, US President Donald Trump visited this plant during the launch of the 787-10 Dreamliner and promised to increase the number of manufacturing jobs in the US. The verbatim message Trump conveyed back then was “jobs is one of the primary reasons I’m standing here today as your President, and I will never, ever disappoint you.””
However, four months passed and Boeing announced its intention to dismiss 200 more people in addition to those 700 who agreed to voluntary layoffs with severance payment. The number of employees at Boeing’s facilities in the Charleston area by the end of June was reduced to about 7,300, while at the end of 2015 it exceeded 8,000.
According to the two main trade unions of the company, from the beginning of the year more than 1800 employees agreed to voluntary layoffs, in 2016, 3000 followed.
Boeing is currently valued at $129 billion. The company will announce its second quarter earnings on July 26.
Source – AeroTime