Australia's air crash investigation agency is to cut its staff by up to 20 per cent.

As the search continues for the Malaysian Airlines flight missing between Malaysia and China, the Australian Transport Safety Bureau is set to tell its 110 workers that at least 20 of them must go.

Unions are demanding that frontline safety inspectors will be quarantined from the cull, which is being blamed on the "efficiency dividend" cost-cutting hitting most government departments.

The bureau is the federal government's lead agency for the investigation of air, rail and shipping accidents, near-misses and safety flaws. The ATSB's staff of about 110 includes about 60 air, sea and rail safety investigators, mostly based in Canberra but some working from field offices in Brisbane, Adelaide and Perth.

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The bureau also provides Australian know-how to help countries in the region investigate tragedies and develop their own safety frameworks.

Transport Minister Warren Truss was on a flight on Tuesday and could not respond to the news but a bureau spokesman confirmed the ATSB was "facing a substantially reduced budget for the coming year''.

"We are currently reviewing the strategies we have in place for meeting that reduction," he said.

"No final decisions have yet been made about what further action needs to be taken to reduce staffing levels.''

Professional Australia, the union that represents many of the bureau's staff, said it was worried the move would see a reduction in the numbers of frontline investigators.

"We are concerned that investigators have been told that these cuts could result in a reduction of investigator numbers," union official David Smith said.