Rolls-Royce announces UK job cuts

<p>Rolls-Royce is set to cut over 600 jobs from its UK operations.</p>

Shares in Rolls-Royce opened 2.71 per cent down in early morning trading on Friday (December 12th) after the company announced job cuts.

The company is embarking on a worldwide restructuring of its operations with hundreds of positions expected to be lost. Rolls-Royce has sites across the UK with a major facility in Derby employing 12,000 workers. Cuts are due to be made in the coming months and will mostly affect the firm's aerospace division.

Around 300 jobs will be lost in Derby while 140 will be cut in the Rolls-Royce plant in Ansty, Warwickshire. Over 150 positions are scheduled for removal at the company's factories in Inchinnan, Renfrewshire, Barnoldswick, Lancashire and Hucknall in Nottinghamshire. The decision is part of the firm's long-term restructuring programme.

A spokesman for Rolls-Royce said: "It is never an easy decision to make changes and propose reductions in our workforce, but it is a sign of the increasingly competitive market in which we operate.

"The measures we have outlined to our employees will contribute towards Rolls-Royce becoming a stronger company in the long term."

Members of the Unite union have described the decision as a "huge loss of skills to the UK economy". Tony Tinley, union officer, explained that it will potentially lead to Rolls-Royce having to outsource high-tech manufacturing jobs from overseas in order to fill the skills. Mr Tinley also called for Rolls-Royce to provide assurances over the long-term stability of its UK operations.

In October, Rolls-Royce warned that sanctions imposed on Russia were beginning to impact on its own operations. It came after the engineering firm saw shares plummet 11.5 per cent and prompted it to revise its group underlying revenue for 2014 to 3.5 per cent to four per cent lower than originally expected.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.