United Kingdom telecoms giant BT axes 13000 jobs

Toby Graves
May 11, 2018

BT Group plc (LON:BT.) is cutting 13,000 managerial and back-office jobs and leaving its London headquarters as the UK's biggest telecoms group launches another restructuring.

BELEAGUERED TELCO BT is to axe 13,000 jobs and move out of its London HQ after 150 years in a bid to cut £1.5bn in costs. It will, however, seek to hire about 6,000 new employees for customer services and network deployment.

The final salary scheme, closed to new members in 2001, had been the UK's largest private sector pension with a total of more than 300,000 members including retirees and ex-employees.

The shares, down 22 percent this year, are trading at levels last seen in 2012.

The announcement comes almost a year after the company said it was to axe 4,000 jobs as part of a restructuring of its Global Services unit.

It is the biggest jobs cut at BT for nearly a decade and far larger than financial analysts in London had been expecting.

He added that it was the "right thing for the business" and would help take BT "into its next chapter".

It explained on Thursday that it was making moves to simplify its operating model by "de-layering" its management structure and ensuring there are "fewer, bigger, more accountable leadership roles".

It was also trying to improve productivity across its core United Kingdom operations, including "process simplification and automation to reduce costs".

It comes as BT reveals year results that were broadly in line with expectations, allowing the firm to maintain the dividend for this year and the subsequent two years.

Specifically in Global Services BT plans to introduce new digital products and focus more on its top global customers, while "significantly lowering costs".

In a strategy update to the stock exchange, the telecommunications giant said the move was needed to maintain its "leading position in converged connectivity and services in the United Kingdom and for multi-national corporations".

Around 80 per cent of its staff are now based in around 50 locations, with some cities hosting multiple offices.

As part of the cost-cutting strategy, BT said that it will be focusing on 30 modern, strategic sites to create a more open and collaborative customer-focused environment.

"We need to do this to be competitive in the future".

"BT delivered a solid set of financial results in the fourth quarter, with growth in our consumer divisions offset by declines in our enterprise businesses, due to both challenging market conditions and our decision to exit lower margin business", said Chief Executive Gavin Patterson.

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