In response to several factors that are impacting our industry and our company, AT&T today announced the elimination of 12,000 management and non-management jobs across the company. The reductions will occur in December and throughout 2009.
The reduction of about 4 percent of our workforce is tied to three primary factors: a decline in customer spending driven by economic pressures; a continued industrywide trend of residential customers shifting from wired voice to wireless and broadband, and competition; and our more streamlined organizational structure which allows us to operate more effectively and efficiently.
In response to these business and economic factors, AT&T plans to reduce its 2009 capital expenditures from 2008 levels. Capital plans for 2009 are being finalized now and specific guidance will be provided when the company releases its fourth quarter results in late January.
“Given the current economic pressures and the business outlook for 2009, we need to make adjustments in our workforce,” said Randall Stephenson. “However, we’ll continue to add jobs in some parts of the business — such as wireless, video and broadband — to meet customer demand.
“Despite the economy’s impact on customer spending, the underlying long-term demand for the connectivity we provide will continue to grow — and we will invest in these areas,” Stephenson said.
“As is always the case when we must reduce our workforce, we will do our best to care for affected employees,” Stephenson said. Many of AT&T’s bargained-for employees have a job-offer guarantee and will have the opportunity to seek positions in other parts of the business, while others will have the option of electing early retirement. All departing employees will receive severance packages in accordance with management policies and practices or union agreements.
“We have seen down cycles before,” Stephenson said, “and we know how to come through them well-positioned for the future. We must be disciplined in where we invest capital, keep an intense focus on expenses and be the best at meeting our customers’ needs.”