Man Utd plans to lay off up to 200 additional employees
Manchester United will make up to 200 jobs redundant to “return the club to profitability”.
About 250 members of staff were made redundant last year in a first wave of cost-cutting measures by co-owner Sir Jim Ratcliffe.
In a meeting with staff on Monday, United chief executive Omar Berrada informed employees that there would be a fresh round of redundancies as part of a “transformation plan”.
A club statement read: “The transformation plan aims to return the club to profitability after five consecutive years of losses since 2019.”
It added that “approximately 150-200 jobs may be made redundant, subject to a consultation process with employees”, with the process expected to take between three and four months.
As of 30 June 2024, Manchester United had 1,140 employees, so 450 redundancies would be 39% of the club’s workforce.
Last week the club revealed a loss of £27.7m in their second quarter financial results and the Red Devils have lost more than £300m over the past three years.
United are on course for their lowest finish in the Premier League era as Ruben Amorim’s team are 15th in the table after Saturday’s 2-2 draw at Everton.
The club statement added that the additional measures are being taken to “improve the club’s financial sustainability and enhance operational efficiency.
“This will create a more solid financial platform from which the club can invest in men’s and women’s football success and improved infrastructure.”
Berrada said: “We have a responsibility to put Manchester United in the strongest position to win across our men’s, women’s and academy teams.
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“These hard choices are necessary to put the club back on a stable financial footing.
“We have lost money for the past five consecutive years. This cannot continue.
“Our two main priorities as a club are delivering success on the pitch for our fans and improving our facilities. We cannot invest in these objectives if we are continuously losing money.”
What additional changes will occur?
United also revealed the appointment of Marc Armstrong as the club’s chief business officer on Monday.
The transformation strategy will involve certain staff relocating from Old Trafford to the club’s Carrington training facility, while a smaller presence will remain in London; however, all of the club’s leadership, including Armstrong, will be based in Manchester.
Staff at Old Trafford will no longer receive free lunches, which will save over £1m annually, while the catering setup at Carrington will remain the same for the rest of the season.
The club’s yearly contribution to the Manchester United Disabled Supporters Association (MUDSA) will stay at £40,000, and discussions are ongoing with the Manchester United Foundation (MUF) regarding its donation amount.
Ratcliffe has revealed a series of cost-reduction strategies since investing in United, with the club stating then that the initial phase of job cuts would save approximately £40m-£45m.
In December, Ratcliffe cautioned that more “challenging and unwelcome decisions” would be made to achieve his vision for the club. The cost of matchday tickets has risen to £66 for each game, with no discounts available for children or seniors.
Ratcliffe has yet to make a decision on whether to renovate Old Trafford, which might cost £1.5bn, or construct a new stadium, which would probably exceed £2bn.
Ratcliffe’s influence on the football operations at Man Utd
In February 2024, Ratcliffe’s Ineos group finalized an agreement valued at approximately $1.6bn (£1.25bn) for a share in Manchester United.
Ineos subsequently assumed control of football operations at Old Trafford and promptly initiated a restructuring with Ashworth named sporting director, Berrada as CEO, and Jason Wilcox as technical director.
In June, Ineos decided to retain Ten Hag as manager, but later dismissed him and his coaching team, incurring a cost of £14.5m.
United spent £11m to acquire coach Ruben Amorim as a replacement for Ten Hag in November, and they additionally expended £4.1m to employ and subsequently dismiss Ashworth.
United’s most recent financial statements revealed a net loss of £113.2m for the year ending 30 June 2024.
This comes after losses of £28.7m in 2022-23 and £115.5m in 2021-22, totaling over £370m in losses for the past five years.
In Ratcliffe’s initial complete season as co-owner, United might end up in the lower half for the first time since 1989-90, when they placed 13th in the former First Division.
Based on last season’s ‘merit’ payments from the Premier League, if United stay in their present 15th place, they will get £16.9m – nearly £20m less than the £36.7m they made for placing eighth last year.
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Securing the Europa League is the sole practical route for the team to qualify for next year’s Champions League, and if they do not succeed, they will face a £10m yearly reduction in their sponsorship agreement with Adidas.
This is expected to increase pressure on United’s ability to strengthen Amorim’s team in the summer and will attract more examination of the rationale behind many of United’s recent transfer activities.
