Manchester United has announced plans to cut up to 200 jobs as part of a comprehensive transformation plan aimed at returning the club to profitability after five consecutive years of losses. This marks the second wave of redundancies under co-owner Sir Jim Ratcliffe's leadership, following approximately 250 job cuts last year.
Chief Executive Omar Berrada delivered the news to staff during a Monday meeting, explaining that the redundancy process is expected to take between three to four months. The club, which currently employs 1,140 people, could see its workforce reduced by 39% when including both rounds of job cuts.
The announcement comes amid challenging financial circumstances for the Premier League giant. United recently reported a £27.7 million loss in their second quarter financial results, with total losses exceeding £300 million over the past three years. The club's statement emphasized that these "hard choices" are necessary to establish a more stable financial foundation for future investments in both men's and women's football programs.
In conjunction with the redundancy announcement, United has appointed Marc Armstrong as the club's chief business officer. The transformation plan includes operational changes, such as relocating staff from Old Trafford to the Carrington training base and maintaining a reduced presence in London. Additionally, cost-cutting measures will eliminate free lunches for staff at Old Trafford, saving over £1 million annually.
The financial pressures on United are further complicated by their current sporting performance. The team sits 15th in the Premier League table following a 2-2 draw at Everton, potentially facing their lowest finish in the Premier League era. This poor performance could result in significant financial implications, with merit payments potentially dropping by £20 million compared to last season's eighth-place finish.
Ratcliffe's Ineos group, which completed a £1.25 billion deal for a stake in Manchester United in February 2024, has already implemented several significant changes. These include the appointment of new leadership positions and the controversial decision to replace manager Erik ten Hag with Ruben Amorim, costing the club £11 million.
The club's financial challenges are further exemplified by their recent history of losses, with their latest accounts showing a net loss of £113.2 million in the year to June 2024. The situation could worsen if the team fails to qualify for next season's Champions League, which would trigger a £10 million reduction in their Adidas sponsorship deal.
Despite these challenging measures, the club maintains its commitment to certain community initiatives. The annual donation to the Manchester United Disabled Supporters Association will remain at £40,000, and discussions are ongoing with the Manchester United Foundation regarding future contributions.
Berrada emphasized the critical nature of these decisions, stating, "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."
The club also faces significant infrastructure decisions, with Ratcliffe still considering whether to rebuild Old Trafford at an estimated cost of £1.5 billion or construct an entirely new stadium, which could exceed £2 billion in costs.
