Boeing (BA) has officially begun the process of workforce reduction, announcing on Wednesday that layoff notices are being distributed to employees affected by its decision to cut 17,000 jobs worldwide, which constitutes a 10% reduction of its global workforce. This move comes as the aerospace giant, grappling with significant debt, seeks to streamline operations and focus on its core priorities.
The layoffs primarily target U.S. employees, who will continue to receive their salaries until January. This arrangement is in compliance with the federal Worker Adjustment and Retraining Notification (WARN) Act, which mandates that companies provide workers with at least 60 days’ notice before mass layoffs or plant closures.
In a statement, Boeing emphasized the necessity of these adjustments, stating, “As previously announced, we are adjusting our workforce levels to align with our financial reality and a more focused set of priorities.” The company also expressed its commitment to supporting its employees through this transition, acknowledging the difficulty of the situation.
This decision was not unexpected, as Boeing had previously indicated that it would commence these notifications in mid-November, aligning with regulatory requirements.
The aerospace sector, including Boeing, has been facing considerable challenges due to decreased travel, production halts, and the financial strain from previous crises, making such drastic measures necessary for financial recovery and sustainability.
Price Action: As of press time, BA is changing hands at $141.68, down about 2.40% intraday.
h/t Reuters
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