We saw quite a bit of consolidation among rural telecom providers in 2009. Among other motivations, companies are coming together to build scale, which they hope makes them more prepared to weather some of the changes and declines in traditional telecom. In this regard, bigger is better, they think.
Unfortunately for some, bigger does not always apply to them and their jobs. In addition to building scale, merged companies look to cut costs – labor costs high among them. It’s a reminder that there are human costs to consolidation.
The latest example is CenturyLink eliminating 600 jobs at the former headquarters of Embarq in Kansas City. The Kansas City Business Journal reports “further job cuts are possible as CenturyLink continues to look for ways to eliminate duplication between the two former companies and deals with the ongoing shrinking of the traditional landline business as consumers switch to wireless and Internet-based service.”
Another example is taking place in Pennsylvania, where Windstream recently closed its acquisition of D&E Communications. Close to 80% of D&E’s workforce will be let go as a result of the acquisition.
The consolidation trend is expected to continue. More job cuts will certainly follow.
5 thoughts on “One Price of Rural Telecom Consolidation: Jobs”
this is not just about rural telecom. <a target="http://www.fiercetelecom.com/story/t-cut-even-more-wireline-employees/2010-01-08 ">Job losses in telecom is a reality – no matter where you work. In fact, if your job is solely based on legacy wireline voice service, I'd be looking to broaden my skills. Also, if you work in a corporate function (i.e. accounting, HR, marketing), you're expendable. If your company is an acquisition target, you're probably in trouble too
I'd also view this consolidation to produce a renewed focus on "deriving efficiency" which roughly translates as expecting more (getting more?) out of existing staff. While not an elimination of a position by functional deprecation, it is more than likely a compounding or overloading of tasks on existing or — depending on your point of view — remaining staff.
I'd expect specialization to take a back seat to generalists and multiple slashes on job functions, if not titles, for the next few years. I'd also expect to see SLA suffer in organizations that relied upon staffing to shorten recovery times in outages.
The on call rotations and dispatch for organizations that have not modernized will be telling. Until the organization completes modernizing to allow for a smaller number of support staff to touch wider and far reaching plant, the next widely publicized outage or issue will have customers asking why someone "was not dispatched sooner".
I've lived that 'more for less' scenario in an operational environment. It's no fun. You often ask yourself, 'how much more water do they expect me to squeeze out of this rock?'