Boeing Commercial Airplanes Chief Executive Ray Conner told employees during a webcast that the company will cut an undisclosed number of jobs as a way to reduce costs.
"We will start reducing employment levels with executives and managers first," the company said in a statement. "We will also use attrition and voluntary layoffs. As a last resort, involuntary layoffs may be necessary."
Boeing shares have dropped 19 percent this year as the company forecast that it will deliver fewer planes in 2016 after a record 762 aircraft in 2015. The company plans to lower production rates for the 777 and the 747, both of which are built in Everett.
Teal Group analyst Richard Aboulafia said airline profits and passenger traffic remain strong, but the overall economy is shaky. Worries continue about the health of China's economy.
"Then you've got oil suddenly getting much cheaper than anyone expected, much faster than anyone expected, and that reduces a lot of incentive for airlines to replace their older jets with new ones," Aboulafia said.
The Chicago-based aerospace company is Washington state's largest private-sector employer, but the company's been shedding jobs here in recent years and moving work elsewhere, including to South Carolina and Oklahoma. At the end of 2015, Boeing employed more than 79,000 in Washington, down from more than 86,000 at the end of 2012.
The company is in a fierce competition with Airbus for dominance in the commercial airplane market, and Aboulafia said that's led Boeing to offer steep discounts, hurting profitability.
"The overall employment impact will depend on how effectively we bring down costs as a whole," the company said in its statement.