Rolls to cut 2300 jobs

Rolls-Royce announced this morning (11 January) that it is to shed 2300 jobs in order to cut administrative overheads and counteract rising raw materials costs and the weak dollar. Announcing “a further stage in the Group’s continuing programme aimed at improving efficiency and competitiveness” Rolls said the move was intended to improve productivity by reducing the number of managerial, professional and clerical staff working in the business. The reductions would focus on overhead and support functions, it said, and it will continue to recruit graduates, apprentices and those required directly to deliver growth. Rolls-Royce emphasised that it had a strong track record of improving sales per employee and productivity and had made significant investments across the business to achieve those gains. “This has underpinned the group’s success in global markets and enabled it to generate skilled employment,” a statement said. There was now scope to achieve further cost reductions through simplifying the organisation of management, professional and clerical staff. The actions would also help the group “to mitigate external headwinds such as increasing raw material costs and the weak US dollar”. The impact of these proposed changes will extend to the UK, US, Germany, the Nordics and elsewhere. In the UK, the Group said it would seek to secure the headcount reductions, wherever possible, through voluntary redundancy. COO Mike Terrett, said the aero engine maker was determined to create a leaner and more agile support structure, better suited to the global markets. “The investments we have already made in new management systems will help us deliver this simplified organisation. Rolls-Royce will continue to focus on ongoing cost reduction and productivity improvements as the business grows,” he added.