“We have made an announcement within our UK Military Air
Solutions business this morning which relates to the beginning of a
consultation process around a proposed 740 job losses from five of our UK
sites,” a BAE spokeswoman said on Thursday.
Europe’s largest defense contractor said the cuts come as a
result of workload changes and will enable it to maintain a lean and efficient
business in the future. “A program of rationalization and efficiencies remains
ongoing,” BAE said.
The Unite union said the cuts would be made across BAE’s
military aircraft sites at Brough, Chadderton, Farnborough, Samlesbury and
Warton.
The union said a further 206 jobs would go at BAE’s Systems
Integrated System Technologies (Insyte) unit.
However, BAE said proposed cuts at Insyte were announced
last November and the consultation process surrounding those job losses would
continue.
Its shares, which have fallen 10 percent this year, were
down 1.6 percent at 318.2 pence by 1045 GMT, valuing the company at around 11
billion pounds ($17 billion).
Britain is reviewing its defense budget as part of a broader
move to cut a record peacetime budget deficit, details of which will be
unveiled on Oct. 20.
Analysts believe a review of defense needs will lead to cuts
of up to 15 percent in the defense budget — 36.9 billion pounds for the current
financial year — with big procurement programs set to be scaled back.
“With the forthcoming defense review these cuts may be the
tip of the iceberg but knee-jerk reactions from employers could make things
even worse,” Hugh Scullion, the general secretary of the Confederation of
Shipbuilding and Engineering Unions said.
“Cuts are being demanded before the shape of the defense
industry has been decided. The defense industry will suffer more than
necessary, if employers make poor judgment calls.”
