T-Mobile has cut 5,000 employees since the Sprint merger

midian182

Posts: 6,763   +61
Staff member
Why it matters: The merger of gigantic companies usually results in job losses. At $26 billion, T-Mobile's merging with Sprint was one of the largest, but the former promised it would create new jobs, not eliminate them. According to a recent report, however, the newly combined company has fewer people working for it now than before the merger.

The Wall Street Journal has revealed that T-Mobile had 75,000 full-time and part-time equivalent workers at the end of 2020, around 5,000 fewer than when the merger with Sprint was finalized. The figures make its previous promise sound a little hollow: "This merger is all about creating new, high-quality, high-paying jobs, and the New T-Mobile will be jobs-positive from Day One and every day thereafter," said former CEO John Legere in 2019. "That's not just a promise. That's not just a commitment. It's a fact."

T-Mobile recently decided to shut down the TVision television channel it started in November, telling employees who still wanted to work in the TV industry that they would need to look elsewhere. While the pandemic has been responsible for many job losses across the world, wireless executives told the Journal that reducing staff was always part of the plan; Covid-19 just sped up the process.

T-Mobile's current CEO, Mike Sievert, said that the company has 6,000 open positions it plans to fill as the economy recovers. T-Mobile also promised to add another 11,000 jobs by 2024. But given the falling employee numbers, it's easy to look at those claims with a heavy dose of skepticism.

The report states that the number of people employed in the telecommunications sector has crashed from a peak of 1.5 million in 2001 to 690,000 today, with many of the jobs having been outsourced. But it's worth noting that outside contractors aren't included in US Labor Department figures.

One person who walked away happy from the merger is Legere. The ex-CEO left with a $136 million severance package on the day it was completed.

Image credit: m_sovinskii

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Tom Yum

Posts: 94   +220
They say it every time with these mergers that jobs will somehow be created and everytime it is complete BS, yet regulators and government fall for it. Why would a company merge if it didn't have cost savings from cutting duplicate departments? They aren't interested in 1+1=2, they are after 1+1=2.5, and that 0.5 comes from cutting employees and increased profits from reduced competition.

You know what that $136 million could have been spent on? Employing 5000 people a working wage for 6 months, I'm pretty sure there is more chance of that generating value for the company (and wider society) than the $136 million golden parachute for Legere.
 

dirtyferret

Posts: 679   +859
"yet regulators and government fall for it"

They don't fall for it, they just expect a nice donation to their re-election campaign.
 

Theinsanegamer

Posts: 2,446   +3,596
And nobody was surprised. Wheny ou merge companies you always wind up with excess fat to be trimmed.

And there was the whole lockdown thing, where so much moved online that you dont need storefront employees anymore.
They say it every time with these mergers that jobs will somehow be created and everytime it is complete BS, yet regulators and government fall for it. Why would a company merge if it didn't have cost savings from cutting duplicate departments? They aren't interested in 1+1=2, they are after 1+1=2.5, and that 0.5 comes from cutting employees and increased profits from reduced competition.

You know what that $136 million could have been spent on? Employing 5000 people a working wage for 6 months, I'm pretty sure there is more chance of that generating value for the company (and wider society) than the $136 million golden parachute for Legere.
27,200 per person, before taxes, isnt that much when you consider that doesnt include any retirement, benefits, ece. And what, exactly, would tmobile need these people for? Sprint wasnt doing bonkers business and t mobile didnt need that many stores to move customers to new plans.

The UK tried the whole "keep employing excess people with work for them" thing. It went rather poorly.
 

Danny101

Posts: 1,623   +697
T-Mobile, a GSM company; Sprint a CDMA company. So how will they keep that allocated or change it?