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1,500 Dead In AT&T Cost-Cutting Measure

NEW YORK—Seeking to reduce costs and streamline internal operations, AT&T eliminated 1,500 mid-level employees Tuesday.

AT&T logo

"The telecommunications industry is an incredibly competitive one and, unfortunately, it is sometimes necessary to make cuts in order to ensure longterm fiscal viability," said AT&T chief executive C. Michael Armstrong, standing among 10-foot-high piles of former employees. "It's a shame that these people are no longer with us, but the end result should be a leaner, stronger AT&T."

More employee liquidation is planned in the near future, with over $23 million in staff cuts over the next 18 months through buyouts, early-retirement incentive packages and pneumatic bolt guns.

Addressing stockholders at a meeting yesterday, Armstrong said he is "extremely excited about the positive impact these changes will make." The company's stock jumped from 62 1/4 to 72 following the announcement of the personnel cuts, the second-largest terminal layoff in AT&T history.

"After a 15 percent drop in profits over the last two quarters, we knew we had to shake things up," said AT&T vice-president of human resources Harold W. Burlingame. "Once we made the decision to eliminate some personnel, our priority was to do so in the most quick and painless way possible. I believe we accomplished this.''

Burlingame expressed regret that AT&T was unable to provide the employees greater advance notice of their liquidation.

"Whenever we let employees go, we try to let them know well in advance, so they have ample time to say goodbye to co-workers, supervisors and loved ones," Burlingame said. "But in this case, we unfortunately couldn't, because we really needed to have them working hard right up to the minute we assembled them in the cafeteria."

Burlingame said AT&T has no plans to offer the 1,500 departed employees severance pay, claiming it would be "of little use to them." He thanked the employees for their many years of loyal service to AT&T and expressed hope that they ultimately find themselves in an even better place.

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