Rolls-royce swings axe to cut costs
Around 4,600 jobs are being axed at Rolls-royce in the latest restructuring as the engineering giant looks to slash costs by another £400 million a year.
The group said the bulk of these job cuts would affect the UK workforce and would be made over the next two years.
Rolls said the overhaul, which follows its announcement in January that it plans to slash its five operating businesses to three core units, will impact support functions and management, including within engineering.
Chief executive Warren East said: “We have made progress in improving our day-to-day operations and strengthening our leadership, and are now turning to reduce the complexity that often slows us down and leads to duplication of effort.
“It is never an easy decision to reduce our workforce, but we must create a commercial organisation that is as world-leading as our technologies.”
Rolls-royce insisted it would honour a previous pledge not to impose compulsory redundancies on union represented staff, including at its sites in Derby, Hucknall and Annesley.
This is the largest reduction in the company’s headcount since 2001, when it announced plans to reduce 5,000 jobs, plus 1,000 contractors, which at the time was around 12% of the workforce.
Overall, Rolls-royce has 55,000 employees worldwide, of whom 26,000 are in the UK, the bulk of which are based in Derby. It employs around 19,400 engineers. Unite union assistant general secretary Steve Turner said: “There is a real danger that Rolls-royce will cut too deep and too fast with these jobs cuts, which could ultimately damage the smooth running of the company and see vital skills and experience lost.”
Rolls said its group-wide revamp will see it shift away from operating with “overlapping activities between individual business units and a large corporate centre”.
A spokesman for the UK Government said: “The government is in regular contact with Rolls-royce on its plans to reduce its back office and support functions workforce as a result of its restructuring programme.
“This is clearly an uncertain time for affected employees and their families and Jobcentre Plus Rapid Response stands ready to help people back into employment as soon as possible.
“Rolls-royce continues to invest in its UK operations, most recently with an additional £150 million in a new large engine test-bed facility in Derby, positioning it to grow further and support increased engine production to deliver on its record order book.”
A Rolls-royce technician works on an aero engine.