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Originally published January 19, 2010 at 7:23 PM | Page modified January 20, 2010 at 8:26 AM

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Boeing says work force here will shrink this year

Boeing's local employment, after rising early in 2010, will drop later this year — but not as sharply as in 2009.

Seattle Times aerospace reporter

Boeing expects employment at its commercial-airplane unit to drop by approximately 2,000 positions this year.

While bleak enough, that's better than the nearly 4,300 jobs it did away with in 2009. And employment will likely rise this year before it falls.

"We do expect a net employment decline," said Boeing Commercial Airplanes spokesman Tim Healy. "Our best guess at this point is roughly half of last year's decline, although there are many variables that could affect the number."

Among the unknown variables are potential further production cuts, which Boeing still maintains won't be necessary.

Though the company has not indicated how employment at its defense unit will fare, prospects there are more discouraging.

Early in 2009, Boeing set an overall target of cutting 10,000 positions companywide and 4,500 within the commercial-airplane unit, measured from its employment levels at the end of November 2008.

About one-third of last year's cuts at the commercial unit came from layoffs, the rest through attrition and dismissal of contractors.

This year, however, "we don't have a layoff target," Healy said. And there'll be job growth to begin with, offset later in the year by more cuts.

"The economic climate drove our decision-making on employment last year. This year, we are returning to a situation where the ups and downs in employment are going to be related to our business needs," Healy said.

"We expect employment is going to grow in the first half of (2010) and toward the end of the year is going to go down."

In the first half of 2010, as the early flight-test aircraft on the new 787 and 747-8 programs roll out, more people will be needed.

Everett production workers report the managers on the new 787 Dreamliner and 747-8 jumbo-jet programs have already placed formal internal requests to increase the number of mechanics on their assembly lines.

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But as regular production ramps up, suppliers should deliver more complete sections and better quality work to the final-assembly lines in Everett, reducing the pressing need for workers there.

A key factor in what happens to employment will be production rates.

Boeing announced late in 2009 that it will cut 777 production in June from seven jets per month to five. But Healy said many of the skilled workers no longer needed will likely be absorbed by other assembly lines, principally the 787 and 747-8.

Because airlines continue to rack up heavy losses, respected industry analysts predict Boeing will likely be forced later in the year to announce a production cut for the 737, the single-aisle jet built in Renton.

If that were to happen, employment would certainly track downward from what is now expected. But so far, Boeing is steadfastly sticking to its assessment that no 737 rate cut will be necessary.

Healy was not able to detail how the employment projections specifically will affect Boeing Commercial's Puget Sound region and the new unit in Charleston, S.C.

At the end of 2009, after a reclassification of some information-technology employees, a total of about 60,000 people worked in the commercial-airplane unit.

Of those, about 2,800 are in South Carolina and most of the rest are in Washington.

The employment picture at Boeing's military and space unit (newly renamed Boeing Defense, Space and Security) is bleaker because of cuts in the government defense budget that have hammered big Boeing contracts such as the Army's Future Combat Systems and the F-22 jet program.

In response to those budget cuts, Boeing last summer announced a reduction of 1,000 defense jobs that is still in process, said unit spokeswoman Kimberlee Beers.

About 5,000 of Boeing's more than 68,300 defense and space employees work in Washington.

This month, even as Boeing is hiring for some positions, the company gave out 60-day layoff warning notices to 125 employees.

Of those, only 15 were in the commercial-airplane unit and only 20 were in Washington.

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

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