AT&T culls another 7,400 staff
'Significantly exceeds previously estimated workforce-reduction target'
AT&T is to stop marketing traditional consumer services, resulting in the loss of another 7,400 staff.
The the US telecoms giant had already planned to cull around 4,900 jobs during 2004 - a cut of around eight per cent of its workforce. But last night it warned that it would "significantly exceed its previously estimated workforce-reduction target...[and] now expects to reduce total headcount by more than 20 per cent in 2004".
Thish means a further 7,400 are to be culled, taking total job losses for the year to 12,300. So far, around three quarters of affected workers have either left - or been told they face the chop. The financial burden of axing so many jobs is expected to cost the company around $1.1bn (£620m).
By the end of the year AT&T expects to employ around 49,000 people - down from the 62,000 ten months ago.
It blamed the move on "sustained pricing pressure and the evolution of services toward newer technologies in the business market as well as changes in the regulatory environment, which led to a shift away from traditional consumer services".
Said AT&T chairman and chief exec Dave Dorman: "In response to recent regulatory developments and a highly competitive market, we have made some tough decisions to reduce our workforce and cut costs." The company remains adamant that the "acceleration of workforce reductions and other cost-cutting initiatives are having a positive impact on profitability across the business".
The telco is also reducing the paper value of its assets by $11.4bn (£6.37bn). ®