Randall Stephenson testified AT&T would add 7,000 jobs if Trump’s tax cut passed, worth $billions to them. Instead, he has cut 37,000 positions. Randall’s going away, but his successor John Stankey is committing to even more cuts.
Almost everyone ignored the 2016 company plan to shed 80,000 positions, although my primary source was a top company executive to the NY Times. That’s a cruel, heartless cutback, possibly the largest since Elisha Gray and Alexander Graham Bell invented the telephone.
It’s probably a good strategy for shareholders, however. Many other telcos are losing fortunes trying to grow in a low growth industry. Much of the 5G hype comes from Nokia & Ericsson trying to persuade telcos to invest in products unlikely to pay off. Until the DirecTV and Warner purchases, AT&T was avoiding stupid investments.
AT&T’s shareholders have been hit by the $20-30 billion dollar overpayment for the TV companies. Randall is a financial wizard and has long obscured AT&T’s underlying business. It now is borrowing money to raise the dividend and buy back stock. Top analyst Craig Moffett has a very rare sell on the stock.
America is a very cruel country to anyone over 40 who loses a job.
AT&T Cuts More Than 37,000 Family Supporting Jobs Despite Promises of Job Creation
AT&T’s Q4 earnings report, released today, shows that the company has cut 37,818 jobs since the Tax Cuts and Jobs Act went into effect in 2018.
Wednesday, January 29, 2020
WASHINGTON — Today’s AT&T earnings report shows that AT&T continues to cut jobs and reduce capital expenditures even as the company announced record operating and free cash flow for 2019 and more than $5 billion in stock buybacks in the past four months. The company has cut 37,818 jobs since the Tax Cuts and Jobs Act (TCJA) went into effect in 2018, including 4,040 in the fourth quarter of 2019. Capital expenditures declined by more than $1 billion in 2019 as compared to 2018.
Last week AT&T notified the Communications Workers of America (CWA) of its plans to cut an additional 200 technician positions in California on February 14, 2020.
AT&T and other corporations continue to be under scrutiny for failing to follow through on their promises to use tax windfalls to create jobs, raise wages and increase investment in infrastructure. AT&T’s CEO Randall Stephenson pledged to create 7,000 new jobs if President Trump’s corporate tax cuts passed. Stephenson also signed onto a statement as a member of the Business Roundtable committing to invest in employees and support the communities where they live and work. Instead, the company is cutting jobs and outsourcing work, including relying on lower wage subcontractors to build its 5G network.
Meanwhile, AT&T has continued to cater to the demands of controversial vulture hedge fund Elliott Management, which purchased a small stake in AT&T in September 2019. Elliott is pushing AT&T to extract profits from the company by eliminating jobs, outsourcing work, and divesting critical assets. In early October, AT&T announced that it would sell its Puerto Rico and U.S. Virgin Island Mobility units to Liberty Latin America (LLA), putting at risk the deployment of FirstNet and nearly 900 union jobs.
Elliott has also won a commitment from AT&T to spend $30 billion on stock buybacks, which will drive up its share price to enrich a small group of wealthy investors, leaving fewer resources for building next generation wireless and fiber broadband networks and training workers for the jobs of the future. Credit-rating agency Moody’s has raised concerns that the large cost of the stock buyback plan puts AT&T at risk for a credit downgrade.
CWA has called on AT&T’s CEO, board of directors, the company’s 100 largest investors, and the Business Roundtable to reject damaging proposals from Elliott Management. Last month, the Private Equity Stakeholder Project (PESP) sent a letter to over 140 investors in Elliott Management on CWA’s behalf, highlighting the deteriorating performance of Elliott’s two primary hedge funds.
“The list of communities being destroyed all across America continues to grow with the elimination of jobs at AT&T, despite promises of job creation from company executives,” said CWA President Chris Shelton. “To make matters worse, AT&T is using its profits to enrich wealthy shareholders instead of investing in building the next generation networks that Americans, especially in rural and underserved areas, so desperately need. CWA members and our allies will keep fighting until the company stops eliminating jobs so that they can provide the high-quality service that customers deserve.”
More than 25,000 AT&T workers represented by CWA will begin bargaining for new contracts in February. CWA’s contract with AT&T Southwest Mobility is set to expire on February 21, 2020, and CWA’s contract with AT&T West will expire on April 4, 2020. In August, 2019, 20,000 CWA members at AT&T went on strike after contract negotiations stalled.
Quarterly Change in Total Employment at AT&T