Rolls-Royce to cut 9,000 jobs amid air travel slump

A Rolls-Royce Trent 500 engine on display at the Dubai Airshow in 2019. The company relies on aerospace for just over half of its annual revenues. (AFP)
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Updated 21 May 2020

Rolls-Royce to cut 9,000 jobs amid air travel slump

  • Aircraft engine-maker adapting to smaller post-pandemic aviation market

LONDON: Britain’s Rolls-Royce said on Wednesday that it would cut at least 9,000 jobs from its global staff of 52,000 and could shut factories to adapt to the much smaller aviation market that will emerge from the coronavirus pandemic.

Rolls-Royce, one of Britain’s best known industrial names, supplies engines for large aircraft such as the Boeing 787 and the Airbus A350.

It is paid by airlines based on how many hours they fly, meaning that its earnings will be hit by the collapse in air travel that is expected to last for years.

“This is about adjusting our capacity to meet future demand,” Rolls-Royce Chief Executive Warren East told BBC Radio on Wednesday.

Rolls-Royce relies on aerospace for just over half of its annual revenues, which were around £15 billion in 2019, and the company said that the job cuts would mostly be in its civil aerospace unit.

The job losses, equivalent to shedding 17 percent of its workforce, would help it to make annual cost savings of £1.3 billion ($1.59 billion), and it would also be looking to reduce expenditure elsewhere on plant, property and capital costs.

Rolls-Royce’s headquarters are in Derby, England, and about two-thirds of its civil aerospace jobs are based in the UK, East said, adding that was “probably a good first proxy” of where the jobs were likely to be lost.

Consultations with unions would now get underway, the company said in its statement, with job losses also expected at its central support functions. Rolls-Royce’s defense unit would not need to reduce headcount, it added.

About £700 million of the £1.3 billion cost savings would come from the headcount reduction, Rolls-Royce said, adding that the cash restructuring costs from cutting the jobs would be about £800 million.

Philippine jobless rate hits record 17.7% in April due to pandemic

Updated 22 min 18 sec ago

Philippine jobless rate hits record 17.7% in April due to pandemic

  • The Philippines is facing its biggest economic contraction in more than three decades
  • April’s 17.7 percent unemployment rate equivalent to 7.3 million people without jobs

MANILA: The Philippines’ unemployment rate surged to a record 17.7 percent in April, the statistics agency said on Friday, as millions lost their jobs due to a pandemic-induced lockdown that battered the economy.
The Philippines, which before the pandemic was one of Asia’s fastest growing economies, is facing its biggest contraction in more than three decades after the new coronavirus shuttered businesses and crushed domestic demand.
April’s unemployment rate, which is 7.3 million people without jobs, compares with 5.3 percent in January and 5.1 percent in April last year.
“We should not lose sight of the fact that this loss in employment is really temporary,” Economic Planning Undersecretary Rosemarie Edillon said in an online news conference.
The lockdown in the capital, Manila, which was one of the world’s longest and strictest, was relaxed as of June 1 to allow much-needed business activity to resume and soften the economic blow of the coronavirus, which has infected more than 20,000 in the country.