Sprint PCS to lay off 1,600 workers

KANSAS CITY, Mo. -- Sprint Corp.'s wireless division will lay off about 1,600 workers, or 6 percent of the division's work force, and release about 500 contractors, the company announced Thursday.

Sprint PCS President Len Lauer said the layoffs were part of the Overland Park, Kan.-based company's efforts to reorganize by getting rid of management and reprioritizing products and services to cut costs.

"With these moves, PCS is reducing layers of management to speed decision making," Lauer said in a news release. "This will allow us to realize immediate, dramatic and positive impacts on Sprint customers, and deliver the kind of superior service our customers expect and deserve."

The layoffs were to begin immediately and be completed by the end of the year, the company said. About 660 of the job cuts will be in the Kansas City area, while the rest will be spread across the country, Sprint PCS spokesman Dan Wilinsky said.

The company said most of the affected employees work in marketing, information technology, network operations and finance.

"We're making moves in areas that largely don't face the customer, or impact the customer," Wilinsky said.

Analysts said the moves made sense because industry growth has slowed.

Impact bottom line

"I don't really expect that this will have much of an impact on the customer, but it will have an impact on the bottom line," said Jeff Kagan, an independent telecom analyst based in Atlanta.

Shares of PCS rose 14 cents to close Thursday at $4.35 on the New York Stock Exchange.

The actions are expected to result in yearly savings of about $170 million.

Sprint, the nation's third largest long-distance provider and fourth-largest wireless provider, has laid off more than 13,000 employees in the last year as the company tries to cut costs.

Rep. Dennis Moore, D-Kan., whose district includes Sprint's headquarters, expressed sympathy Thursday for those who were laid off.

"I keep hearing that the fundamentals of the economy are strong, and it sure doesn't feel that way," Moore said. "To somebody who's just been laid off, it's not a recession or a mild recession, it's a total disruption of your life."