BT plans to nearly halve its workforce within the next five years, cutting up to 65,000 jobs.
The BT job cuts will see it slash total staff numbers from 130,000 to around 75,000 between 2028 and 2030.
The news was announced as BT reported a 50% rise in post-tax profit for the year ending March 2023, to £1.9 billion.
Staff costs for wages and salaries were £3.8 billion for the year.
The BT job cuts announcement came in BT’s annual report which also showed revenues for the year of £20.6 billion, down 1%, a Fibre-to-the-Premises (FTTP) footprint of 10.3 million, and net debt of £18.9 billion.
CEO Philip Jansen said this morning: “By continuing to build and connect like fury, digitise the way we work and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base. New BT Group will be a leaner business with a brighter future.”
BT job cuts come as company overhauls digital arm
As part of an ongoing digital transformation programme – BT’s IT leaders face a £600 million/year bill for maintaining 80% of BT’s 2,400 applications on ageing mainframe and other platforms – BT in Q4 meanwhile entered a 10-year “multi-million-pound” deal with AWS to “bring edge computing to our customers”.
This will include the wide rollout of 5G services for BT’s business customers powered by AWS Wavelength; a service that is an extension of a subset of AWS cloud services into telco infrastructure; i.e. it lets users create an EC2 instance or another subset of AWS services directly in a telco provider’s network.
See also: BT launches new “BT Business” unit, appoints Hena Jalil as CIO
The UK government recently announced a three-year 100% tax expensing benefit on qualifying UK capex, effective from 1 April 2023. BT said that it expected to be a “significant beneficiary” from that scheme, as it targets capex of £5 billion annually through 2026 to build out more fibre and 5G infrastructure.
BT’s leadership has been progressively reducing its workforce in recent years, as the telco targets savings of £3 billion a year by the end of 2025, including across its IT estate, amid concerns about flatlining revenue and debt liabilities including across its pension scheme, which pays out some £2.5 billion to retirees annually.
BT’s move follows the announcement of aggressive restructuring plans by Vodafone this week.
It’s a challenging market: As McKinsey has noted, headwinds in the sector have seen operators respond with a “mix of efficiency measures, digitization efforts, structural changes (such as network sharing), and productivity improvements. In parallel, many expanded into new industries… that formula has been running out of steam.”
(As a still-relevant Bell Labs whitepaper put it over five years ago: “Much of the telecom industry — especially in hyper-competitive markets like Europe — finds itself in a tightening corner. The industry that enabled the web revolution is now at risk of being marginalized to the role of mere access provider, as nimble OTT [over-the-top, e.g. video streaming] web-scale companies and cloud service providers innovate more quickly.”