Boeing is preparing to lay off 2,000 workers, mainly in corporate positions. The U.S. aerospace company will outsource about one-third of those positions to India-based Tata Consulting Services.
«Over time, some of our corporate functions have grown too large. That growth tends to devolve into bureaucracy or inefficient systems,» said Mike Friedman, Boeing’s senior director of communications. «We are streamlining,» the executive added in a statement replicated by The Seattle Times. Even with these 2,000 cuts plus retiring employees, Friedman said the hiring of production line workers and engineers ensures that Boeing will «grow significantly» this year. Boeing CFO Brian West, meanwhile, said the top priority is to accelerate aircraft deliveries. He assured that the manufacturer is «working to concentrate our resources and hiring in factories and engineering».
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In all, about 1,500 jobs will be cut in finance, about a quarter of the company’s total. Up to 400 HR workers, about 15% of the total, will also depart the planemaker. Many of the employees who will lose their jobs have been with Boeing for a long time. This news, unsurprisingly, came as a bitter pill to swallow in the company’s ranks. A senior finance executive, who spoke to Dominic Gates on condition of anonymity, said he is concerned that layoffs at large technology companies may prevent many of these workers from being able to find new work, citing that «a lot of people are realizing they’re not going to get a job».
While it may seem that the financial sectors of companies only do bookkeeping, this is far from reality, particularly in industrial companies and, even more specifically, in aeronautical manufacturers, which typically make multi-year commitments to deliver aircraft. For example, Boeing’s commercial aircraft division must have sophisticated financial planning in place prior to the beginning of production for cost estimates, resource allocation, calculating expense rates, and providing metrics to program managers. When production gets underway, on the other hand, it must collect cost and revenue data to determine profitability and accurately close the books each quarter.
