JOB STOPPERS

If recent actions are any indication, the telecom industry did not hear the news that America's economy is no longer a jobless one. Recent data shows job growth in many areas of the national economy, including several of the technology sectors close to telecom. Yet the telecom industry still seems be headed in the opposite direction.

There is some evidence that telecom's overall economic health is improving. Carrier capital expense budgets, one of the leading gauges of that health, are up this year for the most part. And while wireline local telcos are suffering access lines losses affecting their bottom lines, they also are beginning to discover how to rejuvenate their core business through voice over IP. Mobile carriers are discovering their own new growth engine in mobile data.

However, job cuts — and a lack of new jobs investment — continue to haunt the telecom industry. With companies like MCI, Sprint and Alltel recently announcing fresh rounds of work force reductions, from an employee's point of view, this industry must look much the same as it has for the last three years, with the threat of downsizing — and more recently, off-shoring — lurking in the distance.

Perhaps the job losses and stagnant hiring are more a function of companies like MCI still tinkering with their organizations to maximize the modest revenue growth they are beginning to see. There also is an element of gun-shyness to the telecom industry's ongoing jobs misery — maybe companies aren't hiring because they are afraid the next bust is right around the corner. Maybe they feel one of the lessons to be learned from the last bust is that you shouldn't be so aggressive about hiring people.

Cisco Systems is one of the few large companies that is working against the trend. The company said in a strong earnings report last week that it would hire as many as 1000 new employees. But Cisco was seemingly punished for its optimism when its stock price immediately dipped on the news.

Is there any hope that telecom's biggest-name companies will again hire large numbers of people and create new jobs?

The answers to that question may be no and yes: Blind mass recruitments and commitments to large-scale jobs investment are things of the past — reckless public behavior more than proof of corporate vitality. Hiring may become a more strategic, thoughtful process, the way it once was and probably should be.

However, new jobs will be created. The large companies that are so noticeably not hiring are aggressively outsourcing more functions to smaller firms. It stands to reason that we should soon start seeing more jobs in the telecom industry. We just won't be seeing them where we always expected to see them.