Bombardier, the Canadian aerospace company, has cut its workforce in Belfast by 1,000 after a severe downturn in the private jet market.

As the announcement came, other companies were adding to the jobs gloom. Norwich Union, the household insurance provider, said that it would lose 1,700 jobs this year in an efficiency drive, and Swiss Re, the world's second-largest insurer, is to cut 10 per cent of its 11,500 global workforce, many of whom are based in London.

Bombardier, which owns Learjet, blamed its job cuts on falling demand for corporate and commercial aircraft. Sales of private jets have been particularly hit as entrepreneurs and executives have traded in their aircraft for more humble modes of transport.

Bombardier said yesterday that it expected corporate jet deliveries to fall by 25 per cent this year. The company is cutting its global workforce by 4,300 to cope with the downturn, which has also had an effect on the sales of the company's larger regional jets.

Bombardier's operation in Northern Ireland builds parts for its full range of aircraft, including the fuselages of the $10 million (£6.8 million) Learjet 45.

The factory in Belfast, previously called Shorts Brothers, also makes fuselage sections for the Q400, a turboprop regional craft used by airlines such as Flybe. The company said that 665 contractual and 310 permanent workers would lose their jobs. This is in addition to 300 workers who lost their jobs in February.

Peter Robinson, the First Minister of Northern Ireland, said: “We are seeing a massive blow, not just to the economy of East Belfast but to Northern Ireland. It is something that will cause very considerable concern and anxiety in a number of homes in the Greater Belfast area.”

Norwich Union, part of Aviva, the insurer, said that it would cut 1,100 permanent staff as well as a further 590 contract workers. Because some of the reduction in numbers would come from cancelled job vacancies and staff redeployed elsewhere, the number of permanent staff that would lose their jobs would be about 800, Norwich Union said. Most of the cuts would be in the “business change” and IT departments.

Mark Hodges, the chief executive of Norwich Union Life, the UK life insurance arm, said that the job losses, which caused fury among unions, were “unfortunate but inevitable” as the insurer approached the end of a three-year streamlining plan.

Bombardier's factory in Belfast accounts for 10 per cent of Northern Ireland's manufacturing exports and is one of the region's largest private sector employers.

Learjet and Bombardier's other business jet brands have been hit by cost-cutting at large multinational corporations, such as the Royal Bank of Scotland (RBS), which had used private jets to fly senior executives around the world.

RBS recently sold its Dassault Falcon jet, and other banks have been forced to cancel orders for new aircraft and sell existing ones. Sales of business jets, which seat between seven and twenty people, have also been affected by the reduction in spending power of the wealthy.

Bombardier, which is based in Montreal, said that the knock-on effect of falling sales was that it needed to resize its workforce.The Canadian company bought Shorts from the British Government in 1989 and it has since become a specialist in designing and building composite material parts for aircraft. business.timesonline.co.uk/tol/business/industry_sectors/engineering/article6025207.ece