AT&T has announced plans to eliminate more than 3,400 technician and clerical positions nationwide in the coming weeks, alongside the permanent closure of over 250 AT&T Mobility and Cricket Wireless retail stores, affecting approximately 1,300 retail jobs. citeturn0search0
The Communications Workers of America (CWA), the union representing AT&T employees, disclosed these developments, noting that the company attributes the decision to the economic impact of the COVID-19 pandemic and evolving customer behaviors
In a statement to Business Insider, AT&T emphasized that it is reducing a higher number of non-payroll workers, many located outside the United States, compared to managers or union-represented employees.
This move comes as AT&T faces challenges with declining legacy telecom products. Earlier this year, the Dallas-based carrier outlined a strategic focus on its mobility segment, including 5G technology and fiber growth opportunities, aiming to accelerate business in 2020.
In 2019, AT&T began collaborating with Elliott Management after the activist investor acquired a significant stake in the company. As part of this partnership, AT&T committed to freeing up $2 billion in 2020 and streamlining its portfolio by divesting nonessential assets. However, the unforeseen impact of the COVID-19 pandemic on the first fiscal quarter led the carrier to withdraw its financial forecast for the year.
The company’s workforce reduction plans have drawn criticism, especially in light of previous commitments. Following the 2018 Tax Cut and Jobs Act, AT&T pledged to create 7,000 new jobs. Contrary to this promise, reports indicate that the company has eliminated over 41,000 positions to date.
These developments coincide with a significant leadership transition at AT&T. Longtime CEO Randall Stephenson is set to retire, with President and Chief Operating Officer John Stankey slated to assume the role of CEO on July 1.
As the telecommunications industry grapples with the dual challenges of a global pandemic and rapidly changing market dynamics, AT&T’s recent decisions reflect a strategic shift aimed at navigating these turbulent times.