In a significant move to cut costs and restructure, Southwest Airlines announced Monday it will eliminate 1,750 jobs, representing 15% of its corporate workforce, marking the first major layoff in the company’s 53-year history, The Associated Press reports.
The Dallas-based airline stated the job cuts will primarily target “corporate overhead and leadership positions,” including senior leadership and directors. Eleven senior leadership roles, constituting 15% of the company’s senior management committee, are among those being eliminated.
The layoffs are scheduled to be largely completed by the end of June and are part of Southwest’s plan to transform into a “leaner, faster, and more agile organization,” according to CEO Bob Jordan. The airline estimates the cuts will save approximately $210 million this year and around $300 million in 2026.
This announcement follows Southwest’s offer of buyouts and extended leaves of absence to airport workers in November, aimed at addressing “overstaffing in certain locations.”
The airline has been facing increasing pressure from hedge fund Elliott Investment Management to boost profits and the company’s stock price, which has declined significantly since early 2021. Southwest shares are down 9.9% year-to-date.
Southwest and Elliott reached a truce in October to avoid a proxy fight. However, Elliott secured several seats on the Southwest board, giving them a platform to continue pushing for changes and hold Jordan and other executives accountable.
