Anxiety as 2,200 jobs go at Virgin Media

Nov 12 2008 by Sam Wood, The Journal

MORE jobs in the North East are on the line after Virgin Media announced it was axing 2,200 jobs in the UK.

Last month The Journal reported that jobs could be under threat as the company had been feeling financial pressure.

And last night the company announced that the jobs – 15% of its workforce – would all go by 2012 as part of restructuring aimed at saving £120m.

Virgin Media, which provides television and broadband internet cable services, has a large office in Team Valley, Gateshead, and a smaller one in Newcastle, together employing more than 500 people.

Housebuilder Taylor Wimpey also confirmed it has axed another 1,000 jobs as it said property sales had slumped by 27% since the beginning of July.

The recent raft of job losses brings its total jobs cull to nearly 1,900 in the UK this year.

Taylor Wimpey reported net reservations of 165 on average a week since July 1, despite slashing prices to maintain sales. Britain’s biggest housebuilder said its order book stood at 6,607 homes – 40% less than at this time last year.

A Virgin Media spokeswoman said it was unclear at this stage which locations or departments would be affected by the cuts. No timescale was given for further announcements.

A worker at the firm’s Team Valley office, who wished to remain anonymous, said: “We had an email this morning saying these jobs would be going, but no one has any idea at the moment whether we will be affected. There are a lot of worried people here – it may ruin one or two Christmases.”

The group said it would not start cutting jobs until the fourth quarter of next year, with most of the reductions taking place before the end of 2010 and the rest after that.

Virgin Media said it hoped the “critical” restructure would allow the group to compete effectively and deliver for changing customer needs.

The job losses come as part of a group-wide overhaul following a review this year. The group was formed by the merger of Telewest and ntl in 2006.

Virgin Media has 76 offices in the UK, with major bases including London, Edinburgh, Nottingham and Sheffield as well as those in the North East.

The group shed about 4,000 staff after the ntl and Telewest deal, which was later followed by the acquisition of Virgin Mobile.

A spokesman said the company review was not just about cost cutting, but also better integrating the companies, for example combining about eight billing systems.

The Communication Workers Union, which looks after many of Virgin Media’s workers, said it was seeking assurances on jobs, including when and where any losses would happen.

CWU deputy general secretary Andy Kerr said: “This announcement has come as a complete shock to the CWU. We have not been advised by the company about these job losses.

“We are extremely disappointed at the way Virgin Media has made this surprise announcement, which will be very damaging for staff morale.”

The North East Chamber of Commerce said it was waiting to see how many jobs would go in the region before it would comment on the job losses.

In March last year, Virgin Media lost subscribers in a row with BSkyB. The group estimated 40,000 were lost because of Sky’s removal of its basic channels from the Virgin Media TV platform.