AT&T firing 1,000s of execs and hiring techies

AT&T (formerly known as Wisconsin Bell, McCaw Cellular and a bunch of other stuff) plans to lay off 4,600 mostly white-collar employees, or about 1.5% of its work force, as part of a reorganization due to its shrinking landline phone business.

But AT&T intends to hire back about the same number of people in jobs related to its expanding wireless, television and broadband services. As a result, it expects its total employment to remain constant at about 310,000 in the coming year.

"There are parts of the business that are growing and others that are not," said AT&T spokesman Walt Sharp, referring to the company's landline business, which continues to lose customers. "The jobs in the growth areas are different, and for a variety of reasons we were not able to find additional jobs within the organization for the people impacted."

AT&T is expected to shed 8% of its total access lines in 2008, estimates UBS analyst John Hodulik. That follows drops of 9% and 8% for the two prior years. AT&T had 61.6 million voice line customers at the end of 2007. "The company is continuing to lose voice lines and they have to adapt their cost structure," said Hodulik. "At the same time they have to invest in growth areas."

While the number of people AT&T plans to employ will remain the same in the year ahead, the job cuts could result in substantial cost savings in the neighborhood of half a billion dollars, estimates Hodulik. "There will be quite a bit of cost savings in this plan since it will impact a lot of senior executives and white-collar workers, who are generally more highly paid, and replace them with guys in trucks getting U-Verse into peoples' homes," he added, referring to AT&T's TV and Internet service. (info from the Wall Street Journal)