BT, the UK telecom firm, plans to cut 55,000 jobs by 2030 in an effort to reduce costs following the rollout of its 5G network and fiber broadband. This move comes after Vodafone’s announcement of cutting 11,000 jobs, reflecting the ongoing trend of tech-sector layoffs.
The job cuts at BT account for 42 percent of its workforce, which currently stands at 130,000 employees, including contractors. The company aims to reduce the number of employees to between 75,000 and 90,000 over the next five to seven years. These measures are part of BT’s ongoing cost-cutting initiatives, following a plan that was launched three years ago.
BT’s CEO, Philip Jansen, explained that the workforce reduction is driven by the company’s implementation of full fiber broadband and 5G network, which would require fewer staff for construction and maintenance. Jansen acknowledged the challenging macro-economic environment and stated that the streamlined company would be more efficient and focused on digitization.
Despite reporting a 50 percent increase in net profit to GBP 1.9 billion (approximately Rs. 19,816 crore) for the fiscal year ending in March, BT’s pre-tax profit declined by 12 percent to GBP 1.7 billion (approximately Rs. 17,476 crore) compared to the previous year. Additionally, the company’s revenue experienced a slight dip of 1 percent to GBP 20.7 billion (approximately Rs. 2,12,736 crore). The announcement of job cuts led to a nearly 9 percent decrease in BT’s share price.
Analysts noted that while the job cuts are drastic, they are not surprising given the financial pressures and narrow profit margins faced by the company. The tech sector has witnessed significant job losses globally, including Facebook’s parent company, Meta. BT aims to become a leaner business with a more simplified structure and digital working processes.
The reduction in workforce aligns with BT’s cost-cutting objectives, reflecting the challenges faced by the telecom industry. As the company undergoes transformation and focuses on future growth opportunities, it anticipates operating with a smaller workforce and a more streamlined cost base.