Britain's BAE 'to axe 3,000 jobs as defence budgets shrink'

25th September 2011, Comments 0 comments

British arms manufacturer BAE Systems is to axe up to 3,000 jobs as European governments cut defence budgets, reports said on Sunday.

The job losses, which could be announced in the coming week, will focus on the company's military aircraft division based at two locations in northern England, Britain's Sunday Telegraph newspaper and Sky News reported.

A trade union described the move by BAE, which employs around 39,000 staff across the country, as a "hammer blow" to Britain's defence industry.

BAE is concerned about the time it is taking to secure export orders for the Eurofighter Typhoon aircraft as defence budgets are cut by European governments, the Sunday Telegraph said.

The Eurofighter is made by the four-nation European Aeronautic Defence & Space consortium, representing Germany and Spain, Italy's Finmeccanica and BAE.

In Britain, BAE has been hit by government cuts to public spending, which include a plan to shrink its armed forces and scrap key assets like its flagship aircraft carrier.

BAE said in a statement that it had "informed staff that we are reviewing our operations across various businesses to make sure the company is performing as effectively and efficiently as possible."

"As the outcome of this review becomes clear, we will, as always, communicate to our employees as a priority," it added.

The job losses are the latest blow for staff of the British manufacturer, which has cut more than 15,000 jobs over the past two years.

The defence giant said in July net profits fell 22 percent to £478 million (547 million euros, $740 million at current exchange rates) in the first half of the year on falling sales.

Ian Waddell, aerospace representative from the Unite trade union, said the union was seeking urgent talks with BAE to find out exactly where jobs were under threat.

"These job losses will be a hammer blow to the UK defence industry, which is already reeling with the consequences of the government's 'buy off the shelf' policy," he said.

Opposition Labour party defence spokesman Jim Murphy said the news was a "real knock for UK manufacturing."

© 2011 AFP

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