Only a quarter of BP’s 10,000 job cuts to be voluntary

BP says the layoff of almost 15 percent of its workforce will not affect frontline production facilities. (AFP)
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Updated 17 October 2020

Only a quarter of BP’s 10,000 job cuts to be voluntary

  • BP said voluntary redundancies were offered to people in offices across 21 countries

LONDON: BP is set to make around 7,500 compulsory redundancies after roughly 2,500 staff — or just over one in ten of those eligible — applied for voluntary severance, according to an internal memo seen by Reuters and company sources.
The oil major announced plans in June to lay off almost 15 percent its 70,000-strong workforce as part of chief executive Bernard Looney’s plan to cut costs and “reinvent” the business for a low carbon future.
Many layoffs will come from office-based staff, including BP’s core oil and gas exploration and production division, where thousands of engineers, geologists and scientists are set to leave. They will not affect frontline production facilities.
A BP spokesman confirmed the voluntary redundancy figure.
“We are continuing to make progress toward fully defining our new organization. We expect the process to complete and for all staff to know their positions in the coming months,” BP said in a statement.
The oil industry is facing one of its biggest ever crises, with a collapse in demand and oil prices due to the COVID-19 pandemic and pressure from activists and investors to tackle climate change.
In an internal memo this week, BP said that out of 23,600 people eligible for voluntary redundancy, some 2,500 had applied, including about 500 people in senior roles.
“This means around a quarter of the headcount reduction that Bernard outlined in June, will be voluntary,” the memo said.
“We know that for some people for various reasons they feel that now is the right time for them to leave BP — but for many it will still have been a difficult decision,” the memo said.

FASTFACTS

● 2,500 BP employees opt to leave.

● BP to cut 7,500 more employees.

● Move to low carbon future.

Looney has promised to cut oil and gas output by 40 percent by the end of this decade, a radical pledge for an energy company, as he seeks to dramatically expand renewables production such as offshore wind and solar.
Investors have praised the drive, but also questioned the financial viability of the plan as renewables generate much lower returns.
BP’s shares currently trade at their lowest since 1995, when it was a much smaller company, and its dividend yield stands at a staggering 13 percent.
BP said voluntary redundancies were offered to people in offices across 21 countries. Its biggest offices are in London and Aberdeen in Britain, Houston in the US, Baku in Azerbaijan, Luanda in Angola, and Oman and Trinidad and Tobago.
Two BP sources said the company considered more than 10 percent of those eligible accepting voluntary redundancy as a good turnout. Employees were typically offered one month’s salary for every year of service.
Forced redundancies will now be based on internal scores and rankings.
“Losers get a package and will walk out by the end of the year ... Staff choice is brutal,” a source said.
A second source said the biggest challenge would be for the long timers to try to fill new roles requiring skills and knowledge of the renewables business.
“If you are an oil reservoir engineer the chances are just minimal that you can be retrained as a solar panel engineer,” the second source said.
Speaking to Reuters earlier this week, Gordon Birrell, BP’s head of operations, which includes oil and gas production and refining, said many of the jobs cuts would come from his division.
“The transformation of production and operations is significant, very significant — 10,000 people will leave the company and we’re in the midst of the process — a significant proportion of the overall number are from production and operations,” Birrell said. Rival Shell also plans to cut up to 9,000 jobs.


50% of workers fear losing job in next 12 months: Global economic survey

Updated 29 min 49 sec ago

50% of workers fear losing job in next 12 months: Global economic survey

  • Saudi adults more optimistic of developing new skills for future jobs
  • 195m jobs lost worldwide amid COVID-19 pandemic: Egyptian minister

DUBAI: More than half the global workforce fears being made redundant in the next 12 months, according to a World Economic Forum-Ipsos survey.

The study, released on the eve of the World Economic Forum’s (WEF) Jobs Reset Summit, questioned 12,000 adults in 27 countries about employment prospects during the ongoing coronavirus disease (COVID-19) pandemic.

And although at least 50 percent were concerned about losing their jobs over the coming year, two-thirds of workers worldwide said they could learn the skills needed for the jobs of the future through their current employer.

In Saudi Arabia, less than 20 percent of those who took part in the survey were very concerned about their jobs disappearing, compared to 39 percent in Spain.

While the findings painted an overall gloomy picture of the global job situation amid the COVID-19 outbreak, they also highlighted green shoots of optimism, particularly in the Kingdom.

Around 18 percent of Saudi workers were not at all worried about losing their jobs, more than the global average of 17 percent.

On learning, Saudis were even more enthusiastic, with 39 percent confident of gaining the necessary skills to compete for the new job opportunities of the future.

During a WEF discussion on the impact of the global health crisis on employment, Rania Al-Mashat, the Egyptian minister for international cooperation, described the COVID-19 pandemic as a mix of many crises that had rendered 195 million people jobless around the world.

But she said that Egypt’s young population offered great opportunities for the country and the government had already rolled out plans to tap into youth development before the virus outbreak.

“The Egyptian government has taken comprehensive measures to reshape the education system incorporating a significant technology element to the sector and this turned out to be very useful for home schooling during the lockdown,” the minister added during a session titled, “Building a New Economy and Society.”

Al-Mashat pointed out that Egypt was adopting the principles of stakeholder capitalism, and in order to utilize the energies of its youth had been actively creating entrepreneurial space and building a strong digital infrastructure. She said there had been many policy movements, especially in the creation of gender equality accelerators.

Alan Jope, the CEO of Unilever and a speaker in the same session, said COVID-19 was not the only current world crisis, adding that economic, health, geopolitical, trade wars, climate change, capital wars, and a few looming military conflicts could be added to a global list of crises.

He also noted that gross domestic product (GDP) should not be considered the only economic measure. “Our measures for success need to change, we’ll have to look at social and environmental parameters, and not just the GDP.”

Jope predicted plenty of future jobs but not in traditional areas of work. “Most of the jobs will be created in the low-carbon sector, along with the IT and biotech industries,” he said.