Ericsson could downsize foreign workforce by 25,000 - report

Thursday 17 August 2017 | 13:02 CET | News

Ericsson’s plan to cut its costs further could affect approximately 25,000 jobs, according to Sweden newspaper Svenska Dagbladet’s sources. An article on its website said it will be overseas staff that are hit by the reductions. The newspaper said Ericsson had declined to give it any comment on its plans.

Last week, the company began scrutinising its organisation to identify where SEK 10 billion in savings should be made, it said. The SvD.se article said the sources claimed that up to 80 to 90 percent of workforces in some markets could go. On its home market of Sweden, its 14,000 or so employees should be spared. There are said to be plans to centralise several European markets and downsize their workforces.

One source said Ericsson is even recruiting engineers in Sweden to repair the damage done by earlier cost-cutting plans. The source said Swedish R&D staff must be protected, as they are the ones that will drive sales in the longer term.

SvD cited a source as calling the plans "brutal" and claimed that CEO Borje Ekholm has lost a certain amount of internal support. Managed Services is one area that could be affected by the job cuts, SvD speculated.

SvD said it is not clear whether the job cuts would include staff expected to come off the payroll if Ericsson succeeds in selling its media operations, or whether it includes those affected by it cutting unprofitable contracts within its service organisation.

Ericsson has shed 7,000 workers in the past twelve months, said SvD, most of them in North America, and it now employs approximately 109,000 people.

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