BHP Billiton is preparing to cut more jobs from its operations in Western Australia after slashing 500 jobs from its iron ore business in the north-west in May and further 100 jobs at its iron ore division headquarters in Perth earlier this month.
According to the article on the ABC, BHP could slash up to 3,000 jobs from the 16,000-strong workforce at its iron ore division, with redundancies to be offered as early as next month.
While the company wouldn’t confirm the figure, it is understood that consultants McKinsey & Company – which had been hired by BHP to conduct a review of its business operations –are recommending BHP shed 20% of its current workforce in its iron ore division to ensure it remains competitive.
Speculations say that many of the jobs losses will involve contractors whose positions are coming to an end and their contracts will not be renewed.
“BHP Billiton Iron Ore regularly undertakes improvement initiatives and organisational reviews. We have engaged external consultants to assist with this process. This is about continuing to safely improve our business and ensuring we are a competitive, world-class operation,” BHP told the ABC in a statement.
“We have been open with our employees about the review, and we hold regular all employee Town Hall meetings and question and answer sessions with the business leaders as a matter of course. In situations where employees are impacted we will undertake every effort to assist them throughout the process and to seek redeployment opportunities where possible.”
Steven Price from the Australian Workers Union said members were shocked about the possible cuts.
“It comes as a complete surprise to our members and naturally from that there’s angst about their job security and that then creates safety concerns on the job, because people aren’t thinking about what they should be,” he said.
“They’ve got other things on their mind about paying their mortgage, how long they’ve got a job, if they’ve got a job.”
He said the economic flow-on effect from large scale job losses in the iron ore sector could be huge.
“The worrying part about it is of course that iron ore has always been pretty much the foundation of what everyone else makes their decisions on,” he said.
“And with an iron ore company making such a significant reduction in manning numbers, I think that will put a lot of concern through a lot of other industries through the state.”
Iron ore prices have fallen more than 30% this year to around $90 a tonne.