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Tue, May 08, 2012

Boeing To Ramp Up Production, But Workforce Reductions Are Expected Next Year

Says Efficiencies On The Factory Floors Will Allow Hiring To Slow

Boeing says it plans to increase airliner production as airlines place major orders to replace older jets, but that efficiencies on its factory floors will allow it to slow the pace of hiring replacement workers.

In an interview with Dow Jones Newswires, Boeing VP for Marketing Randy Tinseth said that airline passenger growth is expected to continue to grow by about 5 percent this year, after a 6% jump last year, even with the global economic recovery continuing as a sluggish pace. Tinseth described the backlog of orders for new airliners as a "challenge"

But the Puget Sound Business Journal reports that Boeing's workforce will peak at about 83,000 this year, and then the pace of hiring will slow. The company will continue to replace retiring workers, but at a reduced pace from previous years.

The new employment strategy was first revealed in an April 25 conference call discussing first quarter performance. The company says that even with the planned production increases, fixing production problems on the 787 assembly lines and increasing efficiency of the workforce will allow it to pull back on the number of workers it hires going forward.

The paper says that many of Boeing's suppliers are still in ramp-up mode, with development of the longer Dreamliner continues. But employment analysts say the signs point to an eventual downturn in the workforce as development shifts to production. One Boeing official said that the Dreamliners coming off the line now are significantly less expensive to produce than the first ones to be assembled.

FMI: www.boeing.com


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