Qantas announced on Tuesday that it will cut 850 local jobs and outsource tasks offshore as part of a major technology overhaul driven by artificial intelligence. The airline stated that it has signed a multiyear agreement with professional services firm Accenture to modernise its back-end systems, processes and data while stepping up investment in technology and AI.
Some of the affected services will be transferred to Accenture’s large team based in India. The initial reductions will target staff working in finance, procurement, human resources and marketing. Qantas currently employs about 32,000 people, based on its most recent annual report.
Chief executive Vanessa Hudson said the airline would consult with affected staff and unions before final decisions were made. The first changes are scheduled to take effect by the middle of next year. Hudson acknowledged the announcement would impact workers.
The scale and speed of change in this space is unprecedented and unlike anything businesses have seen in generations, Hudson said. She added that the decision was not a reflection of the contribution or commitment of the workforce, noting that the company knows this will be difficult news for some of its people.
The restructuring marks the third major corporate layoff plan announced in Australia in three weeks, following similar restructuring moves flagged by design company Canva and National Australia Bank. Across these three firms alone, approximately 4,550 corporate jobs have been targeted for cuts, relocations or restructuring in the past month.
The corporate downsizing arrives amid a difficult period for Australian workers. Living costs are surging and the unemployment rate has reached its highest level in nearly five years. A subdued economy, compounded by elevated oil prices stemming from the Iran conflict, is also prompting companies to reduce expenses.
Unions that have previously battled Qantas over controversial outsourcing decisions strongly criticised the move. Scott Cowen, assistant national secretary, spoke out against the plan. AI is having a huge impact on workers across the country, but the cost of technology change should not be borne by the workers who have kept the airline running for years, Cowen said, adding that sending more jobs overseas is not in the spirit of Australia.
Qantas has simultaneously been grappling with rising jet fuel prices. These costs have been partially offset by ticket sales to new customers who switched to the airline after cancelling flights with carriers operating Middle East stopovers.
In a market update late last week, Qantas stated that customer demand was proving resilient. The airline will continue to adjust fares and capacity in response to fuel costs.
