BAE Systems confirms plans to cut nearly 3,000 jobs

MPs Alan Johnson and David Davis react to BAE job losses

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Defence giant BAE Systems has confirmed that it is cutting almost 3,000 jobs at sites across the country, mainly in its military aircraft division.

The firm ended days of speculation by giving details of a huge redundancy programme, saying it needed to maintain competitiveness.

BAE said the company must "ensure its long-term future".

Research group Oxford Economics said 5,700 jobs may now be at risk at BAE's suppliers and in the wider economy.

Union leaders said BAE staff were "distraught and tearful" at the news.

BAE employs 40,000 people in the UK, and 100,000 worldwide, and the biggest job cuts will be at sites in Lancashire and Yorkshire.

The Brough factory, in East Yorkshire, will lose 900 jobs from its 1,300-strong workforce.

At Samlesbury, Lancashire, 565 jobs will go from the 3,970-strong workforce.

At Warton, Lancashire, 843 posts will be lost among 6,537 staff.

Analysis

Defence spending cuts have been blamed for the job cuts at BAE Systems.

Indeed, there was a dramatic slowdown in global defence spending growth last year to just 1.3%, with European nations actually cutting spending by 2.8%.

But overall, global military spending remains strong, having hit a record $1.63 trillion (£1tn) in 2010, about double the global spend seen in 2000.

So there are still big contracts out there and BAE is still gunning for them. For instance, India and Japan are both looking to sign major new fighter jet contracts and the Eurofighter Typhoon is seen as a strong contender.

The challenge for BAE is thus not necessarily just an overall reduction in spending, but rather the tough competition in the fighter jet market, where the Typhoon is up against some competent rivals.

Among other plants affected are operations in Dorset, Hampshire, Surrey, and Essex.

Most of the cuts will be made in BAE's military aircraft division, which is being affected by a slowdown in orders for the Eurofighter Typhoon fighter aircraft.

'Pressure'

Mr King said: "Some of our major programmes have seen significant changes. The four partner nations in the Typhoon programme have agreed to slow production rates to help ease their budget pressures.

"Whilst this will help extend our production schedule and ensure the production line stays open until we receive anticipated export contracts, it does reduce the workload at a number of our sites."

He said changes in the US defence budget would also affect BAE's workload.

Unite, the biggest union at BAE, said it would meet management on Tuesday "and we will be doing everything we can to mitigate the impact of these cuts."

The union said in a statement: "The government cannot sit on its hands and allow these highly skilled jobs to disappear."

'Ashamed'

At the scene

Flying through crystal clear skies above Warton, BAE's Hawk jets have been airborne this morning, their sound ripping through the air every few minutes.

On the ground and behind closed doors, the staff who test them and build Eurofighter Typhoon jets were being told of their fate.

An announcement revealed that 822 jobs are going here and the talk locally is of the huge impact that will have on the local economy.

Mark Menzies, Conservative MP for the area, wants an enterprise zone to be created here to ease the way for future investment.

He points out that the workers affected are highly skilled and, in some cases, world class. For them, it won't be as simple as just going to the local job centre to find work.

Business Secretary Vince Cable said his department would do everything it could to ensure that valuable skills were not lost the the UK economy.

"This news from BAE Systems will be a serious knock to the individuals and communities affected," he said.

TUC general secretary Brendan Barber told the Labour Party conference in Liverpool that the job losses were "yet another devastating body blow to our manufacturing base".

Senior Labour and Conservative MPs Alan Johnson and David Davis, who have BAE plants in their constituencies, criticised the company for the way it handled the news.

Mr Johnson said that after days of media speculation, it had been a case of "terrible news delivered in the worst possible way".

Mr Davis said BAE management "should be ashamed of itself".

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