Newspaper article THE JOURNAL RECORD

AT T Works on Proposal to Cut Thousands of Jobs

Newspaper article THE JOURNAL RECORD

AT T Works on Proposal to Cut Thousands of Jobs

Article excerpt

N.Y. Times News Service

American Telephone and Telegraph Co., struggling to maintain its profit margins in the long-distance calling business, is drawing up a plan that could eliminate several thousand jobs.

The cuts contemplated are in the company's consumer-communications services division, which currently employs 32,000 people, about a tenth of AT T's payroll.

Company executives said Wednesday that the job reductions would range across the division, involving blue- and white-collar jobs and union and nonunion workers.

They also said details of the cuts, including their number, would not be decided for at least a month. The Wall Street Journal reported Wednesday that AT T would cut 4,500 consumer communications jobs.

AT T's stock closed Wednesday at $54.375, down 25 cents, with 2.45 million shares traded on the New York Stock Exchange.

"We can clearly find more efficient ways of doing things," Alex J. Mandl, executive vice president of AT T and chief executive of its communications services group, said Wednesday in a telephone interview from Seattle. "We have some opportunities to manage more efficiently, to use technology better, to eliminate functions not necessary in today's environment, to thin the layers of management."

But he added: "Staff reductions don't solve our cost problems. We have to go after them in many ways."

Mandl said access charges paid to local telephone companies cost AT T $14 billion a 9ear, and purchasing costs an additional $17 billion. Both areas, he said, need a hard look. AT T is talking to both federal regulators and the local companies about cutting the access charges, he said.

Tim Cain, an analyst with Fitch Investor Services, said he expected the Federal Communications Commission to provide relief from the charges, which he said were more significant to AT T's costs than the size of the company's workforce. …

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