The Royal Bank of Scotland announced on Tuesday that it may cut up to 9,000 jobs over the next two years in order to achieve its cost cutting aims of slashing $3 billion.
The cuts represent 20% of the 45,000 staff employed in the bank’s “group manufacturing” division, which includes back office operations, purchasing, IT and property management.
The potential job losses include about 4,500 in the U.K., adding to 2,700 announced previously, an RBS spokesman said. The announcement has fueled a fire of anger over the cuts. RBS is partially nationalized and unions, among other critics, are objecting to the job losses. They argue that since taxpayers own the majority of the bank that huge job losses resulting in people having to go on the dole should not be allowed. Read more about the anger on BBC’s article: “Anger over ‘devastating’ RBS cuts.”
Stephen Hester, Chief Executive of RBS, said: “We have set a new strategy for RBS to restore the Bank to standalone strength as soon as practicable. From this we want the Government to be able to realise value from its investment in RBS. To do so we need to cut our costs, as in all businesses, given the current recession. Unfortunately that means taking difficult decisions about jobs as well as taking many other cost reduction actions. We want to be as open and transparent as possible and are announcing these plans at the earliest possible opportunity so that our employees can prepare for the future.”
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