Big telcos cut another 85K jobs in 2022 as generative AI loomed

Generative AI’s founding fathers have gone all J. Robert Oppenheimer. The man widely credited with developing the atom bomb worked furiously on the science and then panicked that he had given mankind the tools of its own destruction. Having unleashed destructive forces of a different nature, today’s software masters are suddenly calling for a moratorium on AI. Allowed to evolve, it will ultimately kill us, they say.

Long before that happens, just about everybody agrees it will trigger upheaval in the workplace. In the telecom sector, BT boss Philip Jansen reckons AI will claim about 10,000 jobs at his company by the end of the decade, around a tenth of the current total. Numerous telcos are experimenting with the latest AI advances to reduce manual effort and further shrink the workforce. Chatbots have already claimed thousands of customer-service jobs. Highly automated networks can run with minimal intervention by humans. Network operating centers that previously hummed with human activity are turning eerily quiet.

Just as the handloom weavers of the eighteenth century were replaced by the machine operators of the nineteenth, these telco jobs may eventually be succeeded by new and unforeseeable roles. But it is hard to imagine they will be in the telecom sector. Since 2015, the industry’s biggest telcos in North America and Western Europe have been cutting jobs without replacing them. The trend was maintained last year, when the 20 Tier 1 telcos regularly tracked by Light Reading slashed their combined headcount by nearly 85,000 jobs, according to publicly available data.

Those latest reductions mean the workforce across these 20 companies has shrunk by around 384,000 jobs since 2015, more than a fifth of the total back then. Cuts have been driven by efforts to protect margins, pay off debts and offload underperforming or non-core assets as telcos struggle to increase their sales. Across these various companies, reported revenues have fallen from about $761 billion in 2015 to less than $725 billion last year, when converted into US dollars at today’s exchange rate.

Divestments mean not all these jobs have been scrapped. In some instances, people have merely found they are working for a different employer (initially, at least). This would have been the case following the merger between Vodafone’s huge Indian subsidiary and Idea Cellular, for example. The sale of towers by companies such as Spain’s Telefónica will have entailed the transfer of employees as well as concrete and steel. AT&T’s decision to spin off its WarnerMedia business, now combined in a joint venture with Discovery, explains much of the net reduction in headcount last year.

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