Will Return Ranks To Early-2008 Levels
Confirming a rotten piece of news
that, alas, many in the industry viewed as inevitable, on Friday
Boeing announced employment at its Commercial Airplanes business
unit is expected to decline by approximately 4,500 positions in
The planemaker attributes the job losses to an effort "to ensure
competitiveness and control costs in the face of a weakening global
economy." The reduction will bring Commercial Airplanes' employment
to approximately 63,500... roughly the level it was at the start of
2008, before the planemaker ramped up its employment ranks to
handle a record order backlog.
Since that time, Boeing has been hit by slumping new orders for
its planes... and the looming specter of massive cancellations of
existing orders, as airlines around the world scale back their now
overly-ambitious growth plans.
"We are taking prudent actions to make sure Boeing remains well
positioned in today's difficult economic environment," said Scott
Carson, president and CEO of Boeing Commercial Airplanes. "We have
made significant strides in recent years to achieve greater
efficiency and productivity, but we still face challenges that we
"We regret the disruption to those affected by this decision,"
Carson added, "but we believe that acting now will allow us to be
in a financial position to adapt to market uncertainties, meet our
customer commitments, continue investing in our current and future
product lines, and protect our competitiveness in a fiercely
competitive business environment."
Boeing says the Commercial Airplanes division has begun a
program to reduce overhead costs and discretionary spending.
Although normal attrition and a reduction in contract labor will
account for some of the job reductions, layoffs of Boeing employees
also are necessary.
Many of the job reductions will be in overhead functions and
other areas not directly associated with airplane production. This
will enable Boeing to continue focusing on successfully executing
new airplane development programs, delivering airplanes to
customers, continuously improving productivity and quality, and
supporting customer airplanes in the fleet.
Most of the reductions are expected to occur in Washington state
in the second quarter of the year. Affected employees will receive
60-day notices beginning in late February. Boeing will support
laid-off employees with layoff benefits and career-transition
Commercial Airplanes began 2008 employing more than 63,000
people, including contract labor, and increased employment to
nearly 68,000 by year-end.