The crisis of the large European ‘telecos’ reaches the workforce with 100,000 layoffs announced in 2023

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Telefónica will raise soon a new voluntary departure plan to the unions to which they could join up to 5,000 employees, the fourth of its kind in nine years. Telefónica’s situation is not exclusive to the company, nor to the Spanish market, but must fit into the complex situation of companies in the sector in Europe. In fact, three days before, It was Nokia who announced 14,000 layoffs in three years. Two plans that join those presented during the year by some of the main companies in the sector.

Total, European telecommunications companies plan to eliminate almost 100,000 jobs in different plans, more or less aggressive, ranging from immediate exits until 2030, year in which the adjustment announced by BT, the former British Telecom, would end, which has put on the table the most aggressive plan by far. The former British monopoly announced that it aimed to eliminate between 40,000 and 55,000 jobsbetween 30% and 42% of the workforce last May as part of its cost-cutting plan.

BT’s problems were perhaps the most pressing, but equally demonstrative of those that afflict a sector that has been systematically eliminating jobs for years. in response to the lack of return on their investments. BT, like other operators, needs to accelerate its investments in new technologies such as fiber and 5G at a time when its traditional business is not generating enough cash to face these investments at the pace demanded by the market, leading the company to adjust on the other side of the blanket, that is, in the absence of income, costs will have to be cut.

The Ultra-competitiveness has become one of the hallmarks of European markets, existing in places such as Spain and Italy itself, or induced by the Governments themselves as is the case of Portugal or Belgium, where the door has been opened for the arrival of Digi with spectrum auctions intended to give way to new mobile operators.

This has hampered the investment capacity of telecommunications operators, who have been calling for reform at the European level for years that grants them some of their wishes: a real single market that allows them to extract more synergies, a friendlier review of mergers between operators or a new mechanism to finance the networks, which could involve a contribution from the big tech.

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