. . . and 4,500 roles could go at ailing Rolls-Royce
Jobs crisis looms over city famous for its PLANES, TRAINS and AUTOMOBILES
ROLLS-ROYCE could cut up to 4,500 jobs in the East Midlands as it grapples with the fallout of the crisis.
The engineering giant will axe 9,000 roles globally because of the pandemic, with about 1,500 already set to fall on its historic base in Derby. But local leaders have predicted another 3,000 posts could be under threat.
Derby City Council has set up an economic taskforce to look at what support can be offered believing that ‘as much as half’ of the 9,000 jobs going globally could fall on the area, or 4,500 in total.
Paul Simpson, Derby council’s chief executive, said: ‘So far the number was lower than we expected. But I think it is really important that people don’t see that figure and think “that’s it”.
‘It is highly likely there are going to be further cuts next year.’
Rolls, which makes plane engines, said the reduction of nearly one fifth of its 52,000strong workforce will mainly affect its civil aerospace arm, where 8,000 jobs will go of the 9,000 announced.
The latest turmoil follows 1,800 job cuts previously announced by Rolls as part of a separate round of spending cuts.
Derby council leader Chris Poulter has called for the Government to provide support to the area as the coronavirus hammers demand for new aircraft.
Rolls said: ‘There will be further job losses in 2021 but we do not have details of how this will impact individual sites or regions. We continue to work with Derby’s economic recovery taskforce.’
In DERBY, they have a saying: ‘If you don’t work at Rolls- Royce, you know someone who does.’ The catchphrase, often repeated with pride, now has an element of poignancy as people wait, filled with trepidation, for the jobs axe to fall.
The East Midlands town has three claims to global fame: its Royal Crown Derby fine porcelain, its football club and the engineering prowess at Rolls-Royce, a byword for British quality, employing 12,000 locals, equivalent to one in every ten jobs.
Along with Rolls, the town plays host to other major manufacturing employers, including Japanese car maker Toyota, which operates at a plant in nearby Burnaston, and the Canadian train builder Bombardier.
Hence, another local saying: that the town is all about trains, planes and automobiles.
They have brought prosperity. As recently as 2018, the people of Derby on average enjoyed the highest weekly wage in England outside London and the South East.
But with 1,500 Rolls-Royce workers in Derby facing redundancy and questions over Toyota and Bombardier, all of that is under threat.
The job cuts at Rolls will just be the first wave of losses that could see another 2,000 or more shown the door.
John Payne has worked for Rolls for 40 years, the last fourand-a-half of them in Singapore.
He is flying home to the UK with little hope of finding a job on his return.
‘Derby will be decimated. There are some good engineers there,’ he said. ‘It is heartbreaking.’
At Bombardier the situation has also become fraught during the pandemic.
The company’s transportation division, which employs 2,000 workers at its train factory in Derby, is burning through cash and has warned it will have to halt production without state support.
SoCIAL distancing requirements have made its operations less efficient and caused delays, triggering penalty payments under contracts with clients including Transport for London.
Last week it emerged that 400 jobs could go at its plant in Belfast, which makes wings for the Airbus A220.
Toyota was forced to temporarily halt production at Burnaston in March but has since reopened the plant with social distancing changes. It employs some 2,500 workers at the site.
‘Derbyshire has a long history of manufacturing. We have been the hub of the East Midlands engine, if you like,’ says Chris Poulter, leader of Derby City Council.
‘We have a high-tech, high salary, high-skilled workforce in the city but we are disproportionately affected by the pandemic.’
He believes the number of people claiming benefits has doubled since the virus struck.
The plight of Derby is echoed in other regions where manufacturhere ing, despite having shrunk over the past 30 years, still plays a major role. Firms have suffered heavily from the virus, with many seeing a huge decline in orders.
Many factories have experienced problems working while maintaining social distancing.
nearly 40pc believe it will take at least a year to return to normal conditions, according to industry group Make UK.
It adds up to a problem for Boris Johnson’s government, which swept to power on a wave of MPs elected in ‘Red Wall’ industrial seats in the north and Midlands.
Tony Tinley is a regional officer for the Unite union who worked at Rolls for 17 years.
He stood for Labour in Derby north in the election last year, losing to the Conservatives.
He describes the current situation as a ‘perfect storm’.
‘It’s not unique to Rolls-Royce.
It is the British disease of lacking in any long-term vision for industry,’ he said. Regardless of politics, there are many who believe the epidemic should usher in an industrial strategy to regenerate the regions.
When jobs are lost at a big employer like Rolls, knock- on effects are felt in the local supply chain and beyond. The virus may throw far too many people in Derby on the dole.
From shops to bars, cafes and restaurants and even the football club, people are bracing themselves for what they are calling ominously ‘The Hit’.
one pub landlord near to Derby County’s Pride Park football ground, who asked not to be named, said his takings could drop by around 25pc.
‘If folks don’t have the spare money, they won’t be going to the match, so they won’t be coming for a pint, will they?’ There is little doubt Rolls, led by chief executive Warren East, will emerge from the current crisis as a much smaller business.
The worldwide airline industry has been devastated and even the most upbeat of predictions say it is unlikely to recover fully until at least 2023.
Tracey Morrell, 56, is watching the situation apprehensively. She works in the Wayfarer Cafe, a fixture for more than four decades.
‘This cafe is a bit of a tradition with lads at Rolls-Royce,’ she said. ‘Without them and Bombardier we would struggle, we might not even be here.’
Despite the uncertainty Tracey and other small businesses are trying tr to remain confident. Stuart Johnson’s J family have run the Derby Bed Centre for more than 20 years and customers include Rolls staff attracted by the 10pc discount on offer to them at the store in Chaddesden.
‘You can imagine what trade has been like in recent months, simply non- existent, so news of these th job losses is another blow,’ says s Stuart, 44.
‘But we will ride this out and hopefully still be around when the economic climate changes.’
Derby City Council has set up an economic e recovery taskforce involving the unions, the local enterprise partnership, and the chamber of commerce.
Its plan is to boost leisure and culture as well as investing in new green projects. And the hope is that, while its core aero- engine business has been hammered, other parts of the Rolls empire may do better, including its small modular reactors for producing power on a small- scale nuclear basis. But its future is about more than economics for the people of this area. The company has been part of Derby’s identity, its emotional landscape, for more than a century, since it was set up in 1904 by founder Henry Rolls, attracted by the council’s offer of cheap electricity.
In the Second World War, the company developed its famous Merlin engines that powered Spitfires and Hurricanes in the Battle of Britain.
These days, it makes its stateof-the-art Trent XWB engines in a high-tech plant.
But the harsh reality is that the jet- engine maker is facing its biggest crisis since its bankruptcy in 1971.
The city of Derby can only wait and hope.