Boeing Offers Staff The Possibility Of Voluntary Lay Offs

Today, Boeing CEO Dave Calhoun outlined voluntary layoff plans for employees to help the manufacturer weather the coronavirus storm. In a letter to staff, he stated that the long-term effect of the virus, coupled with the recent 737 MAX issues, has resulted in the necessary introduction of money-saving initiatives. It is thought that early-retirement will also be offered.

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Boeing staff will be offered compensation in return for voluntarily leaving the company in an attempt to cut costs. Photo: Getty Images


Boeing has become the latest aviation giant to announce plans to encourage staff to voluntarily leave the company. Boeing has over 150,000 employees around the world. Some employees have been off work since Boeing closed production lines for the MAX aircraft in January.

The fresh set of closures caused by the COVID-19 virus has meant the company can no longer support the huge number of staff it currently employs. So, Boeing will be asking staff to leave in return for compensation. In the internal memo, Calhoun said that only some employees would be eligible and did not specify what the compensation would be.

Three weeks ago, the manufacturer froze pay and said it would not be looking to hire. However, the new statement implies that Boeing will be looking to recruit in some areas of the business to “meet commitments”. Calhoun continued to say that “We’re in uncharted waters. We’re taking actions based on what we know today” so it is likely that the situation at Boeing will change.

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Boeing was already having financial difficulties due to the grounding of its 737 MAX. Photo: Getty Images

Long-term impact

Calhoun was keen to stress the long-term impact the virus will have on the entire aviation industry. He claimed it would take several years before a full recovery could be achieved. As such, Boeing has applied for $60 billion of support. $2 trillion has been set aside by the US government for aid.

It is likely that Calhoun is waiting to see exactly how much aid is coming his way before announcing the details of the compensation package for employees. In the email, he says that further details about what employees will get will be revealed in 3-4 weeks’ time. No doubt the more government money going to Boeing, the better the package will be.

The impact of the virus has come at a key time for Boeing as it was just looking to get its 737 MAX recertified and put a difficult period behind it. Boeing was already strapped for cash due to the complications in grounding the MAX and then halting production. The manufacturer is already due to pay huge amounts of compensation to airlines.

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President Trump holding a photo of a Boeing Dreamlifter at a press conference confirming a $2 trillion aid package for businesses struggling due to coronavirus. Photo: Getty Images

For some in the aviation industry, government aid could help save jobs and in the long run ensure a quicker return to normality. In Boeing’s case, it seems as if government aid is key for keeping the company afloat. Boeing’s stock price has fallen by more than 70% over the past year. However, President Trump did confirm that he would be willing to save Boeing should it come into real trouble.


It is likely that the amount of compensation will depend on the amount of aid Boeing receives, but it has said it will not be laying staff off permanently. A small miracle during such a difficult time. This is perhaps due to the confidence that the President will not let the company go under. The manufacturer’s troubled 737 MAX is due to be recertified within the next few months. This, coupled with a lifting of travel restrictions, it could be enough to see this historic company through an unprecedented time.