AT&T to slash 12,000 jobs

AT&T, the largest US telecoms group, plans to cut 12,000 jobs, or about 4% of its workforce, and reduce capital spending next year in response to the economic slump, which has accelerated the loss of residential phone lines. AT&T is the latest US operator to announce cutbacks in its capital spending, although it said actual spending plans had yet to be finalised. The company is expected to issue further details in late January but analysts expect AT&T to cut spending levels by about 12% from 2008 levels to $17bn next year. The capital spending cuts, reflecting expectations of slowing growth in the mobile market, have added to the gloom among telecoms equipment manufacturers. Nokia Siemens, the equipment joint venture, said Thursday it expected telecoms network equipment spending to decline by about 4% next year. AT&T shares have dropped about 30% so far this year, as investors have questioned whether the company can make up for the rapid decline in traditional wireline customers.

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