UK’s British Telecom to make ‘drastic’ job cuts, layoff 55,000 staffers by 2030 in cost-cutting measure

UK’s British Telecom on Thursday announced a ‘drastic’ job cut that will result in the lay-off of 50,000 staffers by 2030. This cut will account for 42 per cent of BT’s workforce, which currently employs around 130,000 staff, including contractors, as per AFP news agency. The move is taken as a cost-cutting measure amid increased costs and slim margins. 

AFP quoting Hargreaves Lansdown analyst Matt Britzman said, “Headlines will no doubt focus on the job cuts.”  “It’s drastic, but it’s not overly surprising given the mounting costs and slim margins in the wider business,” Britzman added. 

This comes after UK mobile phone giant Vodafone announced to cut off 11,000 jobs, one-tenth of its workforce, over three years. After the jobs cuts, the workforce will come down in between 75,000 and 90,000 over the next five to seven years, BT said in a statement.

A number of tech companies this year have laid off a significant number of their staff members. It includes giants such as Facebook parent Meta, Google, among others. One of the major reasons why companies are laying off their employees is inflation which has taken the world economy for a downfall. 

“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. In the statement, he added, that the firm is “navigating an extraordinary macro-economic backdrop.” 

On the contrary to the grim side, BT said that once the telecom’s full fibre broadband and 5G network are launched the firm would not need staff then to be able to maintain it. 

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’s revenue dipped  

BT on Thursday also announced that the firm’s net profit soared 50 percent to £1.9 billion ($2.4 billion) in its fiscal year to March. However, performance-wise the company is not keeping up on its game. The performance was skewed by a one-off tax credit.

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Meanwhile, pre-tax profit sank 12 percent to £1.7 billion from a year earlier and revenue dipped one percent to £20.7 billion. Following the news of job cuts, investors went jittery. BT’s share price dipped almost nine per cent to 134.80 pence in morning deals on the rising London stock market.