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BellSouth cutting up to 5,000 jobs

Friday, May 17, 2002

Associated Press WriterATLANTA (AP) -- Regional phone company BellSouth Corp. said Friday it plans to cut 4,000 to 5,000 jobs -- up to 5 1/2 percent of its work force -- as it struggles with a weak economy, tougher competition and regulatory pressures.

The company said it would slash both management and non-management jobs as part of the cuts.

"We face a fiercely competitive marketplace, and we must continue to reduce our cost structure in order to compete," chief executive Duane Ackerman said in a statement. "We also must continue to deliver our products and services at competitive prices to meet the increasing demands of our customers."

The cuts are the largest yet as BellSouth, which serves nine Southeastern states, struggles with a still-soft economy.

In October, BellSouth slashed 3,000 white-collar jobs. And in December, it eliminated 1,200 technical and clerical jobs throughout the service area. Most of those 4,200 workers were based in Georgia.

The latest round of cuts were announced to BellSouth's nearly 86,000 employees in a company-wide e-mail Friday afternoon, spokesman Jeff Battcher said. Ackerman also announced them in a video conference call with company executives.

For management employees, severance package offers will be mailed May 27, and the deadline for accepting them is June 14. Non-management job cuts will be worked out through the workers' union.

If the voluntary measures don't produce enough job cuts, layoffs will begin in July, Battcher said.

"We fully expect most of these reductions to come from the voluntary offer that we have on the table now with these employees," he said.

The announcement came two days after government regulators gave BellSouth the go-ahead to offer long-distance service in Georgia and Louisiana.

Federal approval came only after the telecommunications company resolved regulators' worries that it had done too little to allow competition in the local phone game.

The company said it would take an after-tax charge of $250 million to $300 million as a result of the reduction.

Excluding a one-time gain on an asset sale, BellSouth fell short of Wall Street expectations in its first-quarter earnings report and said it expected weak sales for the rest of the year.

Atlanta-based BellSouth serves nearly 45 million customers in the United States and 14 other countries.

It is the regional phone provider for nine Southeastern states: Louisiana, Mississippi, Georgia, Alabama, Tennessee, Kentucky, Florida, North Carolina and South Carolina.

BellSouth shares slid 23 cents to $33.27 Friday in afternoon trading on the New York Stock Exchange.

------On the Net:

BellSouth Corp.: http://www.bellsouth.com


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