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Big job cuts expected - Observer

Thomson Reuters could announce thousands of job cuts as early as this week, The Observer reported. The new company, which employs around 50,000 people, has set a 19 May deadline to outline an extensive programme of redundancies, “according to insiders”, the UK Sunday newspaper said. But following months of speculation details of where the axe will fall are expected to be made public by Friday.

“Analysts have been predicting that around 5 per cent of staff – 2,500 people – could be laid off, but the numbers could be higher than that after the group last month raised the amount of cost savings it plans to generate over the next three years from £250m to £375m,” The Observer said. The bulk of the cuts are expected to be made in Europe where Thomson and Reuters both have a large presence.

There is less overlap in North America and virtually none in Asia, The Observer said. Union officials expect at least 100 of Reuters 2,400 journalists to be axed, but that number will be inflated hugely by further cuts, with technicians, salesmen and middle managers worldwide likely to be purged.

Further savings will come from selling or vacating head office buildings and winding down contracts with suppliers, The Observer said. But most cost-cutting in the first year of the three-year programme is likely to come from laying off staff rather than reducing other overheads.

“We are expecting thousands of cuts,” it quoted a London-based union official at the group as saying.

SOURCE The Observer