Boeing drafting notices to axe thousands of jobs as crisis deepens

Thousands of Boeing employees are set to receive layoff notices within weeks as a senior United States official flew to Seattle to try to ease a crippling strike and a major airline issued a warning over the planemaker's deepening turmoil, said industry sources.

Acting US Labour Secretary Julie Su's first in-person intervention comes days after Boeing BA N unveiled plans to cut 17,000 jobs and take $5 billion in charges, continuing a year of tumult for the company.

In a statement issued on Monday, a Labour Department spokesperson said: "Acting Secretary Su is meeting with both parties today to assess the situation and encourage both parties to move forward in the bargaining process."

While Su has previously spoken with Boeing and the striking West Coast factory workers' union, it is her first time in Seattle meeting both sides in person.

The International Association of Machinists and Aerospace Workers (IAM) said its lead negotiator, Jon Holden, had updated Su on the current talks, "stressing the Union's commitment to a negotiated contract that values our members' skills and dedication".

Boeing and a White House spokesperson declined to comment on Su's visit.

Roughly 33,000 workers have been on strike since September 13, seeking a 40% wage increase over four years.

Boeing will next month send out 60-day notices to thousands of workers including many in its commercial aviation division, meaning those staff will leave the company in mid-January, said a source familiar with the matter.

A second phase of notices, if needed, could be rolled out in December, said the source.

A spokesperson for the Society of Professional Engineering Employees in Aerospace, which represents Boeing engineers, said the company informed the union on Monday that 60-day notices to its members would be issued on November 15.

A Boeing spokesperson said the company had shared information with managers including plans for 10% reductions at its commercial unit involving both union and non-union workers.

The spokesperson added that the striking IAM employees were not currently affected.

Brian Bryant, the IAM's international president, called the job-cut plan "corporate greed at its worst".

"Boeing just turned its back on 17,000 of its workers — the same people who carried Boeing through crisis after crisis, year after year," he said in a statement.

Boeing will refrain from asking for voluntary departures to limit severance cash and avoid an exodus of skills, sources said, adding the company will rely solely on involuntary layoffs. Rivals are scooping up scarce labour to relieve pressure on aerospace supply chains.

"The trick will be not losing the 10% of people you want to keep, which is even more important than usual in the post-pandemic skill shortage environment," said Agency Partners analyst Nick Cunningham.

Boeing has been hiring workers to prepare for higher production rates that have not materialised as output was capped by regulators following the blow-out of a door plug on an Alaska Airlines jet in January.