Amid Mobile Boom, Wireless Sheds Jobs

Susan Hall

When the Labor Department's dismal June jobs report came out, showing a net gain of just 18,000 jobs across the United States for the month, I pointed out that the tech hiring picture is much more rosy. Though tech tends to be a good place to be, that doesn't hold true for telecommunications.

 

Foote Partners counts 34,600 jobs lost in the telecommunications sector between May 2009 and April 2011. Indeed, AT&T announced job cuts of 5,900 in the first quarter, attributing that to a continuing decline in its landline business.

 

Though wireless communications is growing rapidly, employment in that industry is far from secure, reports The Wall Street Journal. Despite industry revenue that's up 28 percent, wireless employment hit a 12-year low in May, with headcount at U.S. carriers at 166,600, down about 2,000 in the past year and about 20,000 fewer than in June 2009, according to Labor Department figures.

 

And for the telecom industry as a whole, employment has dropped by 39.7 percent in the past decade from 1.45 million in 2001 to 877,100 in 2011.

 

Bob Roche, vice president of research for wireless-industry trade group CTIA, however, says the group's own survey puts wireless employment at about 250,000 at the end of last year, down about 16,000 since the end of 2007. Meanwhile, the number of wireless devices topped 302 million in 2010, up 19 percent since 2007.


 

The story points to consolidation, outsourcing and productivity gains in the industry for the decline in jobs. In fact, among the telecom workers that remain, output per hour has nearly tripled since 2002, the Labor Department says.

 

Just as Facebook has created huge numbers of jobs at companies trying to leverage the social network, the mobile boom has created big job gains among the likes of Google, Twitter, Foursquare and others.The story quotes Robert Atkinson, president of the Information Technology & Innovation Foundation, a Washington think tank, saying:

"Even with all of the growth of more cellphone users and the like ... the industry has been able to do that with a lot less people." It's the "ecosystem that is on top of that core network" that "is going to be a growth engine."

But the real hurt is among customer-service workers, whose numbers have dropped to 33,580 last year from 55,930 in 2007. Carriers have been able to cut customer service by creating simpler phones that are easier to activate and simpler plans. For instance, Sprint reports that it has reduced its call centers from 74 in 2007 to 44 last year and its total head count from 60,000 to 40,000. Beyond productivity gains in call centers, an AT&T spokesman pointed out that more customers choose to go online to choose their phone or pay their bills, reducing the need for call center agents.

 

Other work is eliminated through outsourcing, such as Sprint's network-management deal with Ericsson in 2009. Of 6,000 workers transferred to Ericsson, 800 moved to other jobs within Ericsson, while another 500 left or were laid off.

 

And more layoffs are expected if AT&T gains regulatory approval to acquire T-Mobile. Most reports put the expected cuts to be in "thousands," though an unnamed source at The New York Post puts it as high as 30,000. (T-Mobile employs 30,800.) The union Communications Workers of America, though, supports the merger as a job-creator. It says the new AT&T would generate about 100,000 jobs through a promised $8 billion in investment in its LTE network.



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