Boeing CEO Kelly Ortberg has told employees that the company will temporarily furlough thousands of staff, including executives and managers, after more than 30,000 workers went on strike over a rejected labour contract.

The new four-year contract offer promised a 25 percent pay increase over four years and improvements to terms and conditions, having been recommended to employees by union leaders. However, 96 percent of employees reject the agreement, impacting operations at factories building the 737 MAX, 777 and 767 freighter.

Affected employees will take one week of furlough every four weeks throughout the duration of the strike and Ortberg and his team will take pay cuts until the company and the International Association of Machinists and Aerospace Workers reach a deal.

“While this is a tough decision that impacts everybody, it is in an effort to preserve our long-term future and help us navigate through this very difficult time. We will continue to transparently communicate as this dynamic situation evolves and do all we can to limit this hardship,” Ortberg outlined.

Following the start of the strike, Fitch Ratings warned a prolonged strike could lead Boeing to be downgraded, while Moody’s put Boeing’s credit ratings on review for a downgrade.

Boeing has already laid out spending cuts, including a hiring freeze, reductions in expenses at supplier and a ban on non-essential, first and business class travel during this “difficult period”.

“This strike jeopardises our recovery in a significant way and we must take necessary actions to preserve cash and safeguard our shared future,” Boeing CFO Brian West told staff in a letter last week. “So our immediate focus is to the laser-like focus on actions to conserve cash, and we will.”