Sage set to reveal extent of job losses

May 5 2009 By Peter McCusker, The Journal

THE extent of the job losses at Newcastle software giant Sage look set to be revealed tomorrow. Earlier this year the company invited all of its 2,200 UK staff – including the 1,600 at its Newcastle headquarters – to apply for voluntary redundancy with some experts now estimating 200 UK jobs will be axed.

A further 400 overseas jobs are likely to go – and this is on top of the 400 jobs it axed across its global operations last year.

The jobs announcement is expected to be made on Wednesday when the company unveils its interim results for the half year ended March 31, 2009.

The job losses represent about 8% of the 14,500-strong global workforce at Sage and will save around £50m a year. The group is expected to say all the cuts will be achieved through voluntary redundancies and by not replacing people who leave rather than compulsory job losses.

Last month Paul Stobart, Sage’s UK and Ireland managing director, told The Journal: "The changing market we’re in means that it is more important than ever to look at the costs we incur as a business and how we can become even more effective in the way we work.

"As all businesses are at the moment, we’re doing everything that we can to keep costs to a minimum and in addition we’ve let our people know today that we are offering our UK staff the chance to take voluntary redundancy.

"We felt that a voluntary redundancy programme would offer people the chance to consider opportunities beyond Sage and help us reduce headcount and costs."

All workers earlier received a letter telling them of the plans, which it said were "offering Sage people the

opportunity to take voluntary redundancy that’s incentivised as a way to minimise the risk of future compulsory redundancies".

Sage was formed by Graham Wylie in 1981 and went from strength to strength, becoming the only technology stock on the FTSE 100.

Today, the firm, which develops and sells business software, employs more than 14,000 people across the world, serving 5.7 million customers.

Sage’s British base is its state-of- the-art office accommodation at Newcastle Great Park, Gosforth, where 1,600 of its 2,200 UK workforce are housed.