London British telecoms group BT said Thursday it will axe up to
55,000 jobs by the end of the decade in the latest tech jobs cull
in response to rampant inflation.
The layoffs, comprising 42 percent of BTs workforce, come two
days after UK mobile phone giant Vodafone unveiled plans to cut
11,000 jobs or one tenth of staff over three years.
Both have been struggling with the pressures of inflation, most
notably from energy, said Victoria Scholar, an analyst at
Interactive Investor.
BT employs 130,000 staff, including contractors.
The group will lower this to between 75,000 and 90,000 people
over the next five to seven years, it said in a results
statement.
The grim news follows the axing this year of tens of thousands
of jobs across the global tech sector, including by Facebook parent
Meta, as soaring inflation also saps the world economy.
BT is implementing further cutbacks, having already slashed
costs under a plan launched three years ago.
By the end of the 2020s, BT Group will rely on a much smaller
workforce and a significantly reduced cost base, said chief
executive Philip Jansen.
The company was navigating an extraordinary macro-economic
backdrop, he added.
The slimmed-down group will be a leaner business with a brighter
future and will digitise the way we work and simplify our
structure.
BT said that once its full fibre broadband and 5G network was
rolled out, it would not need as many staff to build and maintain
it.
The firm also revealed Thursday that net profit soared 50
percent to 1.9 billion ($2.4 billion) in its fiscal year to March,
but the performance was skewed by a one-off tax credit.
Pre-tax profit sank 12 percent to 1.7 billion from a year
earlier, while revenue dipped one percent to 20.7 billion.
Shares slump
Investors took flight following news of heavy cutbacks.
BTs share price sank almost nine percent in early morning deals
on the rising London stock market.
It later stood at 138.95 pence, down 6.2 percent from Tuesdays
close.
Headlines will no doubt focus on the job cuts, noted Hargreaves
Lansdown analyst Matt Britzman.
Its drastic, but its not overly surprising given the mounting
costs and slim margins in the wider business.
As part of an ongoing overhaul, the firm announced a tie-up last
year for its pay-TV channel BT Sport.
BT and Warner Bros. Discovery agreed to combine televised sport
offerings in UK and Ireland.
The new joint venture, combining the assets of BT Sport and
Eurosport UK, will launch later this year under the banner TNT
Sports.
The move will mark the end of the BT Sport brand, which was
launched ten years ago and features costly coverage of Englands
Premier League football.
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