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Halcrow to axe 269 staff as recession bites deeper

Two major consultants were this week preparing to make significant job cuts, as the recession in construction showed no sign of letting up.

Halcrow confirmed plans to shed 269 of its 4,200 UK staff − a 6% cut − in response to an expected fall in workloads across its multidisciplinary business over the next two years.

Arup has also confirmed plans to make a further 100 redundancies, on top of the 400 announced in January.

Halcrow’s cuts will affect the firm’s water, power, transport, consulting, and corporate services divisions.

Halcrow is among the last of the major consultants to announce a major round of job cuts following announcements earlier in the year from Atkins, WSP and Mouchel.

Hard to explain

The water sector cuts reflect a wider consultants’ response to the current downturn in water spending. Other cuts are harder to explain. Halcrow recently won the Crossrail delivery partner contract.

It is thought the firm had been holding off cuts in the hope that it could keep teams together. “We can no longer sustain current staffing levels,” said Halcrow chief executive Peter Gammie.

“We have worked hard to minimise the effect of recession on Halcrow.”

Peter Gammie, Halcrow

“This difficult decision was not made lightly and…. we will make every possible effort to reduce the number of redundancies and assist where we can with people’s personal arrangements.

“It is extremely regrettable that we have had to go down this route. Since the early days of the global economic downturn, we have worked hard to minimise the effect of recession on Halcrow.

“As a business, we remain focused on our long-term well being and on our clients and on their day-to-day requirements for the delivery of their projects,” he said.

Two hundred and sixty nine staff have been placed on a 30-day consultation programme.

In a statement the firm said: “The engineering consultancy sector will continue to see reduced activity, or perhaps even a further deterioration, through 2010 and beyond.”

Tougher times for contractors

The latest news from Halcrow, on the back of other cuts in the consultancy sector signifies tougher times for contractors, who are further down the supply chain.

New data from the Civil Engineers Contractors Association (CECA) shows an accelerating decline in workloads in July compared to April, and a resulting plunge in tender prices. In April, every sector with the exception of rail showed a decline in workload, but these falls appeared to be levelling-off (NCE 21 May).

But CECA’s July survey shows that the rate of decline has increased again in all sectors including rail.

CECA national director Rosemary Beales said: “This survey confirms the widespread feeling that economic recovery is still a long way off.”

Who’s cutting whom

  • Atkins 1,200 jobs
  • Mott MacDonald no changes
  • Arup 350 jobs
  • WSP Group 1,000 jobs
  • Mouchel 600 jobs, around two thirds of which are in the UAE
  • Jacobs pay freeze
  • Halcrow Group 267 jobs
  • Scott Wilson 10% staff cuts
  • Capita Symonds no changes

Readers' comments (7)

  • It would seem that the quoted consultants (Atkins, WSP etc..), with their short term profits and earnings targets, have been much more aggressive in cutting jobs that their private rivals.

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  • I presume most of these redundancies are for graduate to mid level engineers. May I propose a 20% pay cut for top brasses earning more than £70k and save some of the redundancies. Surely this wouldn't make much difference in their lifestyles but save some families. This will also generate loyality.

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  • I was made redundant by Arup in April as an Associate with Arup, so not grad/mid-level. Frustratingly my previous performance had been well received, though length of service (<2 years) counted significantly against me. It's difficult not to feel aggrieved that a compromise or pay cut across the company/UK business was not possible - this would surely have maintained loyalty as suggested.

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  • In my experience, the bosses have saved themselves (and in some cases been promoted in a restructure) and taken out the mid-level staff, not grads. Cheaper to get rid of the mid-level staff and keeping grads means it's cheaper to do what little work comes in. It is very true that the non-private consultancies are being more ruthless. In many, there has been no thought to pay cuts, reducing the working week, 6 month sabbaticals, re-training to busier sectors (eg Nuclear) or voluntary redundancies. Just cold calculated lay offs. The private companies will be a better place to bid for work as they will have the staff CVs to show for their prudence even if they don't make as much profit. Bit of a vicious circle.

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  • Interesting debate here on the methods taken by private and quoted consultants.
    I work for a private consultant. A good few months ago, before any redundancies happened, all the partners toook a 10% pay cut.
    It may have saved some redundancies, but at the end of the day parts of the business weren't viable with the number of staff they had - there simply isn't the work out there.
    Cuts have happened at all levels in the affected departments - from graduates and junior technicians right up to associates. Not sure if any directors have gone or not.

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  • Not metioned in the job cuts is Grontmij, surprinsingly. They have reportedly cut between 10-15% of total staff. They seam to prefer to sweap it up the carpet rather be open with staff and clients. Perhaps because there are rumours that Lawrence Hughes and Roger Pyle (MD and director) took between 10-15 % pay rises and nearly half million in bonues between then in 2009. Surely this can't be morally right if the rumours are true.

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  • I agree with what was said by Anon on 24-Aug. I was made redundant from the Atkins Distribution Networks department, along with many of my colleagues. If you look at who is remaining, it is almost exclusively the directors, senior managers and graduates. They have made sweeping cuts to mid-level staff, who in my opinion are probably the most cost-effective, given the relatively low wages, but high productivity and technical skills. It is an extremely short-sighted approach by Atkins and highlights the poor management decisions which has partially contributed to their current position. Couple this with the fact that they are shifting as much of their work offshore to India. My experience with using offshore staff made it obvious that although their were cost advantages for rote tasks, they did not have the capacity to make important decisions using engineering judgement. This will have severe long-term consequences for Atkins when workload does increase again, and the management only have themselves to blame.

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