SBC to cut 5000 jobs in Q2

SBC Communications today announced it would eliminate 5000 jobs in the second quarter 2002 due to the “continued poor economy and a burdensome regulatory environment.”

The cuts will occur across the carrier’s 13-state region and would involve management and non-management employees “not directly involved” in serving customers, SBC said in a press statement.

The cuts come a day after the Supreme Court affirmed the FCC’s rights to apply the TELRIC (total element long-range incremental cost) formula to rates set by state commissions for unbundled network elements provided to competitive carriers under the 1996 Telecommunications Act.

SBC President William Daley blamed policymakers in part for the newest round of cuts. "Policymakers could provide this industry and the U.S. economy with a boost by creating rules which provide an incentive for companies to invest and create jobs," Daley said. "As the rules stand now, SBC is discouraged from investing in new infrastructure or new jobs. These rules are not economically rational, and they are uncertain at best."

Previously, SBC reduced its workforce about 10,000 in the past two quarters. In April, the company said it would “probably eliminate” 4000 positions over the last three quarters of 2002. The workforce cut of 5000 announced today will be completed by the end of June, the company said.

--Glenn Bischoff, Senior News Writer