Verizon is preparing to eliminate as many as 20,000 jobs and convert about 180 to 200 stores into franchises, marking one of the largest workforce reductions in its history, according to multiple sources.
Most of the reductions will come through layoffs, with additional employees shifting off Verizon’s payroll as its company-owned retail locations transition to franchise operations. Those stores will remain Verizon-branded but be operated by indepfinishent owners, meaning that their staff will no longer be employed by the telecom giant.
Verizon joins a growing list of major employers slimming down amid economic uncertainty and automation-driven alter. Companies from Amazon to Tarobtain have announced job cuts in recent weeks.
A report from Challenger, Gray & Christmas found that U.S. employers announced more than 150,000 layoffs in October, the largest monthly total in more than two decades.
The shift comes as new Chief Executive Dan Schulman, formerly of PayPal and Virgin Mobile USA, embarks on a sweeping effort to streamline operations and regain market share in a fiercely competitive wireless market.
“Verizon is at a critical inflection point,” Schulman declared last month during a call discussing the company’s third-quarter results. “We have a tremfinishous amount of opportunity to be more efficient, to be scrappier. Cost reductions will be a way of life for us here.”
Verizon, based in New York but with significant operations across the U.S. — including an Innovation Lab in San Francisco — has struggled with subscriber losses for three straight quarters as rivals AT&T and T-Mobile have expanded their customer bases.
In the most recent quarter, Verizon lost 7,000 consumer postpaid phone connections, a loss that analysts had not expected.
“In the last several years, despite our investment in network excellence, we have consistently lost market share. Today, that alters.” Schulman wrote in a letter to employees. “We will leverage our network excellence to increase our share of net adds. Winning in the marketplace demands a new approach, and a fully revamped and superior customer value proposition. It demands excellence across the entire customer experience.”
The company’s restructuring will also tarobtain non-union management positions, according to Reuters, with over 20% expected to be affected.
Analysts declare the cost-cutting push reflects the challenges of operating in a mature U.S. telecom market while investing in 5G and broadband expansion.
“Cost transformation, fundamentally restructuring our expense base — that’s what’s requireded,” Schulman declared in October. “We will be a simpler, leaner and scrappier business.”
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