Telecom Companies Cut Hundreds Of Jobs As Legacy Businesses Decline

Three of the country's largest carriers have been quietly announcing employee layoffs during the past month.    

AT&T said it plans to cut more than 1,000 employees from its landline and other legacy service sectors early this year. Comcast let go of more than 500 salespeople in December. 

Both telecom providers lobbied heavily for tax reform at the end of 2017, stating that it would drive economic growth and create higher-paying jobs. Comcast was the most active lobbyist on tax issues in 2017, having filed 60 lobbying activity reports related to taxes and tax reform, according to the Center for Responsive Politics. AT&T, the ninth most active lobbyist on tax issues, filed 29 activity reports last year. 

Dallas-based AT&T said in December that it plans to invest an additional $1 billion in the United States during 2018 once the Tax Cuts And Jobs Act, which was signed off on by the President on December 22, becomes law. The carrier also announced it would pay a $1,000 bonus to more than 200,000 U.S.-based employees who are union-represented, non-management, and front-line managers.    

About a week before it announced the bonuses and investments, AT&T notified 600 workers across a variety of positions that they would be laid off, according to a report from the Chicago Tribune. 

When reached by CRN, a spokesperson for AT&T said it is not commenting on which business units would be affected by the layoffs, or specifically on whether the channel team or indirect salespeople would be impacted by the staff cuts. AT&T told CRN that it has plans to add an unspecified number of new employees and help terminated employees find a new job within AT&T during 2018.   

"We’re adding people in many areas where we’re seeing increased customer demand for products and services. At the same time, technology improvements are driving higher efficiencies and there are some areas where demand for our legacy services continues to decline, and we’re adjusting our workforce in some of those areas," said a spokesperson for AT&T. 

"Many of the affected employees have a job offer guarantee that ensures they’ll be offered another job with the company, and we’ll work to find other jobs for as many of them as possible," the spokesperson added. "In other cases, we may be hiring the same resources in other regions, and employees would be able to transfer." 

Comcast also promised $1,000 holiday bonuses to more than 100,000 "frontline and non-executive" employees in December following the passage of the tax reform bill. The Philadelphia-based cable behemoth also revealed plans on spending "well in excess of $50 billion over the next five years" on infrastructure to improve and extend its broadband plant and capacity, as well as on its television, film and theme park offerings.    

"With these investments, we expect to add thousands of new direct and indirect jobs," Comcast's chairman and CEO Brian Roberts said in a statement in December. 

Before the holiday publicity, Comcast let go of more than 500 managers, supervisors, and direct sales employees across Chicago, Florida, and Comcast's Midwest and Southeastern U.S. regions, according to company documents. The layoffs took place on December 15, said a former employee who spoke to local news outlet, The Philadelphia Inquirer, under the condition of anonymity due to a nondisclosure agreement as part of the employee's severance package. 

Comcast did not comment on the company's plans regarding job creation in 2018 when reached by CRN, but said that that the layoffs were a result of a reorganization of its direct sales force to give employees more responsibility for bigger territories.

“Periodically, we reorganize groups of employees and adjust our sales tactics and talent. This change in the Central Division is an example of this practice and occurred in the context of our adding hundreds of frontline and sales employees. All these employees were offered generous severance [and] health benefits," said a spokesperson for the cable giant.

Comcast said that the former employees were also given the opportunity to apply for other Comcast jobs.

In late December, Comcast also notified customers that it would be raising the price of its standalone 25 Mbit/s internet service by $10 a month to $75.    

"Price hikes are par for the course, so it's not that alarming to us," according to one solution provider executive that asked not to be named. "I also think that fiber is going to put coax to bed, and it costs these carriers a lot of money in construction costs to put in fiber, so I'm not surprised by the price increases."    

So far, the solution provider executive said that their team hasn't suffered any direct impact as a result of the staff layoffs from the carriers, and doesn't have any deals on the table that are currently affected by any indirect staffing changes with the carriers. 

Monroe, La.-based telecom provider CenturyLink, like its counterparts AT&T and Comcast, also made news in December when it announced it was canceling holiday bonuses for its employees. CenturyLink CEO Glen Post blamed cash flow issues in an email to employees last month.     

In November, CenturyLink revealed it would be laying off about 165 employees after the close of its $34 billion acquisition of Level 3 Communications. 

 

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