Manchester United to cut 250 jobs – why?

Jean-Claude Blanc stood in front of Manchester United’s workforce on Wednesday and informed them that the club plans to lay off 250 of them.

The blow to staff comes as United co-owner Sir Jim Ratcliffe continues his efforts to cut costs at Old Trafford.

And as part of these cost-cutting exercises, Blanc, the interim chief executive, has told staff they will be making significant redundancies.

Annie Hale, United’s head of human resources, was with Blanc when the news was delivered, but Ratcliffe and Sir Dave Brailsford, Ineos’ sporting director and United board member, were absent.

The Athletic breaks down the latest cost-saving measures…

What did Manchester United set out to do?

United have set the wheels in motion for a club-wide redundancy program which will see 250 staff lose their jobs.

They say it is a decision that was not taken lightly and that alternative routes were considered, but only resulted in short-term solutions.

United’s layoff program is a management decision that has been agreed to by both ownership groups – meaning the Glazer family, who remain in overall control, signed off on it.

That the Glazers are relaxed about INEOS making significant changes has been noted as a reflection of the confidence they have in Ratcliffe and his management team.

Interim chief executive Blanc broke the news to staff (Ash Donelon/Manchester United via Getty Images)

How many jobs are they looking to cut?

United are seeking to cut 250 jobs across all departments and levels – except, they say, the Manchester United Foundation, their charity arm – before the start of the 2024-25 season.

The Athletic revealed in May that the club’s non-footballing staff – staff who are scouts or playing staff – have been offered voluntary redundancy.

This offer, valid until June 5, has been made to staff at Old Trafford, their Carrington training base and their head office in London.

INEOS anticipated around 20 per cent of employees would accept its proposal, which would have seen employees receive their annual bonuses, only for their proposal to have low take-up.

Why do I do this?

To save money.

When INEOS’s minority investment was ratified in February, it quickly hired Interpath Advisory, a consulting firm, to look at business and operational costs at the club.

INEOS believes United’s workforce is bloated compared to other Premier League sides and that its size does not reflect their footballing performance in recent years, despite the club beating Manchester City to win the FA Cup in May.

The cost analysis has identified financial savings and “non-essential” activities they can stop, which in turn can help United better comply with the financial regulations of the Premier League and UEFA, European football’s governing body.

There is a belief on the part of the hierarchy that there are more employees than they need to deliver success, which is another motivation for reducing headcount and costs.

What was the reaction?

Even though the potential job cuts have been behind us since late last year, there was still a sense of surprise when the news was delivered. While those in the room pointed out that there was no sudden gasp, they noted a solemn mood.

Almost a quarter of United’s workforce will be made redundant and many, understandably, could point to the money spent on transfer fees over the past decade, totaling more than £1bn ($1.27bn). and exorbitant salaries offered to underperformers. players.

INEOS have made it clear from the outset that they are focused on making the football team successful again, meaning this decision could only be seen as a brutal example of achieving what they believe will be needed to bring the club back to winning ways.

However, staff members were told months ago that they were essential to contributing to success on the ground, and now 250 of them will be out of a job.

A prominent supporter representative, speaking anonymously The Athletic to protect relationships, noted: “If the club wants to make real savings, there are players we’d sooner see offloaded than see the club’s hard-working staff pay the price.”

Have they introduced other cost-cutting measures?

At a business meeting in May, Ratcliffe told staff they could no longer work from home and ordered them back to the office.

In some quarters, INEOS’ plan was seen as radical and they received pushback from Patrick Stewart, who was interim CEO before being replaced by Blanc and is no longer employed.

Another cost-saving measure taken by INEOS, which was very unpopular with staff, was to ask staff to pay £20 to travel in a club-supplied coach to the men’s FA Cup final against Manchester City , in May, at Wembley Stadium in London.

United staff asked to contribute to their journey to the FA Cup final (Marc Atkins/Getty Images)

Traditionally, United’s workforce were offered a free ticket to such games – which INEOS continued to honor – but this time they had to contribute to their travel and received no food on the outbound journey -400 miles round trip (320 km).

Company credit cards were also taken from staff members in another cost-cutting exercise.

How does United’s workforce compare to other clubs?

Accounts for the year ending 30 June 2023 show United have an average of 1,112 monthly employees, up from 1,035 in 2022 and 983 in 2021 – and the largest workforce in the Premier League.

Liverpool’s account for the year ended says it has 1,008 employees. Of these, 701 are classified as working in “administration, commercial and other” and a further 238 are players, managers and coaches.

Manchester City, winners of the Premier League for the past four seasons, had an average of 520 employees, including players and football staff (201), in the year ending 30 June 2023, less than half of United’s.

However, it is worth noting that City are part of a multi-club umbrella organisation, the City Football Group, which has additional staff.

At the other end of the Premier League scale, Brentford’s accounts for the year ended show they had a monthly average of 243 staff, which includes players and training staff (129).

(Bradley Collyer/PA Images via Getty Images)