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T-Mobile
said in a regulatory filing Thursday that it plans to cut 5,000 jobs, or 7% of its workforce. The move comes a few years after then-CEO John Legere told Congress that a merger with rival Sprint would be a major jobs creator.
In a 2019 hearing scrutinizing the merger, Legere told the House Subcommittee on Communications and Technology that after combining with Sprint, T-Mobile would have thousands more employees than the stand-alone firms combined in its first year.
“By 2024 we will have 11,000 more employees,” Legere said, according to a transcript of the hearing.
“Our critics are wrong about the impact on jobs,” Legere added, responding to a skeptical analysis from the Communications Workers of America labor union. “I have looked at their arguments and supposed analyses and they do not make sense. They ignore the facts. They don’t account for any areas where jobs will grow, like network integration or new customer call care centers.”
Public filings suggest the critics weren’t wrong. Prior to the merger, T-Mobile and Sprint disclosed a combined employee count of around 81,500 employees. T-Mobile ended 2022 with 71,000 employees, according to the company’s annual report. After the latest cuts, the head count will be closer to 66,000.
“These layoffs, combined with cuts T-Mobile has been making since its merger with Sprint, show how hollow the company’s promises to be a job creator from day 1 were,’” CWA spokesperson Beth Allen told Barron’s Thursday. “Sadly, CWA’s analysis of the likely job loss as a result of the merger has proven correct.”
(CWA is affiliated with the union that represents Barron’s newsroom employees.)
T-Mobile did not return requests for comment about its former CEO’s statements. Legere couldn’t be reached for comment.
Shortly after his Congressional testimony—in an April 2019 blog post—Legere reiterated the company’s commitment to job creation.
“So, let me be really clear on this increasingly important topic,” Legere wrote. “This merger is all about creating new, high-quality, high-paying jobs, and the New T-Mobile will be jobs-positive from Day One and every day thereafter. That’s not just a promise. That’s not just a commitment. It’s a fact.”
Current CEO Mike Sievert told employees in a Thursday email that the cuts will affect corporate and back-office staff, and some tech roles. Retail and consumer care employees would not be effected, he said, and the firm doesn’t anticipate widespread cuts in the foreseeable future. In the email, which was disclosed in a filing with the Securities and Exchange Commission, Sievert cited rising customer acquisition and retention costs.
“What it takes to attract and retain customers is materially more expensive than it was just a few quarters ago,” he wrote.
Write to Connor Smith at [email protected]
Read the full article here
