British Telecom (BT) has announced a significant reduction in its workforce, with plans to lay off 50,000 employees by 2030. This downsizing will account for 42% of BT’s current workforce, which consists of approximately 130,000 staff, including contractors. The decision to cut jobs is driven by the need to reduce costs in the face of rising expenses and narrow profit margins.
Hargreaves Lansdown analyst Matt Britzman, quoted by AFP, commented on the job cuts, stating that while the move is drastic, it is not entirely surprising given the challenging financial circumstances and slim profit margins faced by the company.
This announcement follows a similar move by Vodafone, the UK’s mobile phone giant, which plans to eliminate 11,000 jobs over a three-year period, representing one-tenth of its workforce. BT stated that after the job cuts, its workforce will be reduced to a range of 75,000 to 90,000 employees within the next five to seven years.
Several tech companies have implemented significant layoffs this year, including Meta (formerly Facebook) and Google, citing reasons such as inflation impacting the global economy.
BT’s CEO, Philip Jansen, stated that by the end of the 2020s, the company will have a smaller workforce and a more cost-effective structure, attributing the job cuts to the challenging macro-economic environment.
In a more positive outlook, BT mentioned that once its full-fiber broadband and 5G network are established, the company will require fewer staff to maintain them, emphasizing the benefits of digitization and a simplified organizational structure.
Although BT reported a 50% increase in net profit to £1.9 billion ($2.4 billion) for the fiscal year ending in March, its performance fell short in other areas. Pre-tax profit declined by 12% to £1.7 billion, and revenue experienced a 1% dip to £20.7 billion. Investors reacted to the news of job cuts, causing BT’s share price to drop by nearly 9% to 134.80 pence on the London stock market.
Post Your Comments