British Airways was licking its wounds yesterday after announcing plans to re-structure its business with a 35% reduction in the number of its 1,715 managers by March 2008.
This effectively translates into a 50% reduction in senior managers, from 414 jobs to 207 and a reduction of 30% in middle management from 1,301 jobs to 911 jobs if the programme can be agreed. This brings the total number of jobs on the block to 597.
Willie Walsh, BA's relatively new Ceo said yesterday that it should come as no surprise to anyone that the airline's cost base should be addressed first: ‘We must lower our costs so that we can fund future investment in our business. I am confident that these measures, however difficult, will help to build a robust British Airways and one that will benefit from sustained profitability. This action will enable us to carry out the investment we need to make in our business in the coming years in order to deliver a more competitive and efficient airline.’
According to BA the proposed job cuts will save the airline ?50m as part of its drive to achieve a ?300m cost reduction programme by March 2007, announced in January 2004.
The airlines says it plans to carry out the reduction in the number of senior managers in three phases. Phase one will see 94 of the top executives (23%) leave the business by March 31, 2006. Further reductions will continue during the next two years with the 50% target achieved by March 2008.