10,000 jobs to go at BT

Telecoms giant BT is to slash 10,000 jobs by the end of March 2009, which represents 6% of its global workforce.

According to the group, the cuts will mainly affect agency and contract staff, including offshore workers.

It is understood that several thousand jobs are expected to go in the UK. However, the group said they are not a ‘direct result‘ of the economic downturn.

The group has already cut 4,000 jobs, with a further 6,000 to go by the end of March from its global workforce of 160,000.

BT chief executive, Ian Livingston, admitted that many of the job losses will be in the UK, with about 4,000 core positions affected.

Despite the bad news from the group, BT shares were up 13.5p (12%) in early trading today as the job losses will lead to lower costs.

According to Keith Bowman, equity analyst at Hargreaves Lansdown stockbrokers, the group’s marked intention to improve profitability could see another turn in investor sentiment, this time upwards.

The job losses come after figures from the Office for National Statistics (ONS) revealed that UK unemployment is at an 11-year high.

According to the ONS, in the three months to September the number of people out of work in the UK soared by 140,000 to 1.82 million, the highest level since 1997.

This week, other major companies to announce job losses include Virgin Media who are slashing 2,200 jobs from its 14,600 workforce.

Housebuilder Taylor Wimpey, said it has shed 1,000 employees as a result of the slowdown in the housing market and the fall in demand for new homes.

In addition, the world’s second largest drugs maker, GlaxoSmithKline, said it is to shut its manufacturing site in Dartford with the loss of over 500 jobs.

Meanwhile, the British handheld computer maker, Psion, has announced 200 job losses.

Finally, Vodafone, the world’s largest mobile phone company, has announced a cost-cutting exercise, which has led to job fears.

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