15.06.09 Shell shake-up could lead to huge job cuts

Up to 24,000 staff could be affected after Royal Dutch Shell announced some huge changes to its structure. The move has been instigated by Peter Voser, the new chief executive of the company, and as yet the number of cuts has not been specified. However, it is thought that they could well run into thousands.

Cost cutting is at the forefront of the changes, but so too is the need to simplify the structure and increase the speed of implementation. The new boss will take over on 1 July, and the three big changes to the company will include:

• the merging of the three upstream businesses into two: Upstream Americas and Upstream International


• the creation of a Projects & Technology division


• the absorption of various parts of the company into specific units

It all comes as a result of the loss of Linda Cook, a board director who had worked at Shell for 29 years and who recently decided to quit quite suddenly. The merger of the upstream businesses will also involve the company getting rid of the position that she used to hold.

The three upstream businesses currently employ 22,000 staff between them, so it is clear why there are worries that job cuts will be inevitable. On top of that, Shell’s corporate affairs division, which employs 2,000 staff, is also set to be streamlined.

The likely casualties from the merger could also include up to a third of senior managers. The decision to restructure is also set to hit the UK hard because the company has an upstream operation in Aberdeen and a corporate affairs function in London, and this will all add yet more redundancies for the UK.

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