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Business briefing: Rolls-Royce to axe 9,000 jobs with UK taking brunt

ROLLS-ROYCE plans to axe 9,000 jobs amid the ongoing coronavirus crisis, with UK factories set to be hardest hit.

The Derby-based aerospace giant, which has furloughed 4,000 workers in Britain, announced a major reorganisation as demand for aircraft, and the engines it manufactures, slumps across the world.

Chief executive Warren East acknowledged it was ‘terrible news’, but said the business needed to be protected.

The company, which also has sites in Bristol, Glasgow and Lancashire, said the cuts could result in £700million towards an aim of £1.3billion in annual savings.

Mr East warned it will take ‘several years’ for aviation to recover from the ‘unprecedented’ impact. He added: ‘This is not a crisis of our making. But it is the crisis that we face and we must deal with it.

‘Our airline customers and air-frame partners are having to adapt and so must we. Being told that there is no longer a job for you is a terrible prospect, and it is especially hard when all of us take so much pride in working for Rolls-Royce.

‘But we must take difficult decisions to see our business through these unprecedented times.’

The cutbacks also put thousands of jobs in Rolls-Royce’s supply chain at risk.

Steve Turner, of the Unite union, said: ‘The news that Rolls-Royce is preparing to throw thousands of skilled, loyal, world-class workers, their families and communities under the bus during the worst public health crisis since 1918 is shameful opportunism. This company has accepted public money to furlough thousands of workers. Unite and Britain’s taxpayers deserve a more responsible approach to a national emergency.’

The latest overhaul follows measures announced in June 2018 to axe around 4,600 jobs and save £400million a year.

Paul Everitt, of trade body ADS, said the pandemic was ‘having a major impact on aerospace’ and called for ‘urgent action’.

BUSINESS BITES

■ ONLINE shopping has outstripped all other forms of spending during the past month, with 57 per cent of UK shoppers saying they are buying from websites more than ever, according to research from Mastercard.

■ INFLATION fell to 0.8 per cent last month — its lowest level since August 2016, as fuel costs and energy bills tumbled. But the cost of games, toys and fresh vegetables rose, said the Office for National Statistics.

■ MARKS & SPENCER has taken a £52million hit from the pandemic. And it expects clothing sales for the four months to July to be down 70 per cent. Overall profits for the past year have fallen by 21 per cent to £403.1million.