Covid-19 Crisis Wipes Out Tens of Thousands of Jobs as Companies Announce Mass Layoffs

Strategic Insights -

The latest wave of job cuts has seen British Gas owner Centrica join the ranks of major companies shedding thousands of staff in the wake of the Covid-19 pandemic. The move comes on the heels of announcements from chemicals firm Johnson Matthey, Bombardier Aerospace, and Heathrow airport, which are all slashing roles to stay afloat. The job meltdown, which has seen tens of thousands of roles wiped out so far, has prompted economists to warn that the situation will only get worse if the Government persists with its 2-meter social distancing rule.

Key Takeaways:

  • Centrica, the owner of British Gas, is slashing 5,000 jobs to speed up cost-cutting plans, in addition to the 4,000 already planned this year.
  • Johnson Matthey is cutting 2,500 staff, with one-sixth of its workforce losing their jobs in just three years due to the pandemic.
  • Bombardier Aerospace is shedding 2,500 roles globally, with 600 jobs being cut from its factories in Northern Ireland.
  • Heathrow airport's passenger numbers have plummeted by 97% in May compared to the same time last year, hammering the company's demand for new aircraft.
  • The Organization for Economic Cooperation and Development (OECD) has warned that unemployment could almost triple to 11.7% in the summer, with more than 2.5 million jobs at risk.
  • Many firms, including pubs and restaurants, are struggling to operate under the 2-meter social distancing rule, with an estimated one million jobs at risk in the hospitality industry alone.
  • Centrica's job cuts will see more than half of the roles being cut in management, as part of plans to wring out £2bn in savings by next year.
  • Mark Pettifer, regional officer for union Unite, has said: "These job losses are another blow to the already fragile British economy and have created worrying uncertainty amongst the entire workforce."
  • Centrica's CEO Chris O'Shea has said: "I truly regret that these difficult decisions will have to be made and understand the impact on the colleagues who will leave us."

Statistics:

  • 5,000 jobs are being cut at Centrica
  • 2,500 staff are being cut at Johnson Matthey
  • 600 jobs are being lost in Northern Ireland at Bombardier Aerospace's factories
  • 97%: Heathrow airport's passenger numbers have fallen in May compared to the same time last year
  • 11.7%: The Organization for Economic Cooperation and Development (OECD) has warned that unemployment could almost triple in the summer
  • 2.5 million: The number of jobs at risk according to the OECD
  • £2bn: The savings that Centrica plans to wring out by next year
  • 3,800: The number of workers that Centrica has furloughed
  • 27,000: The number of staff that Centrica employs

Sources:

  • The Telegraph: "Centrica to axe 5,000 jobs as it reveals more than half of cuts will be in management"
  • Reuters: "Johnson Matthey to cut 2,500 jobs due to COVID-19 impact"
  • BBC News: "Bombardier to cut 2,500 jobs globally"
  • The Telegraph: "Heathrow airport reveals 97% fall in passenger numbers"