Dec 4, 2008 6:18 pm US/Pacific
AT&T Cutting 12,000 Jobs; San Ramon To Feel Impact
SAN RAMON (CBS 5 / KCBS) ―
AT&T's plans to cut 12,000 jobs nationwide even as it continues to hire in its cellular and broadband Internet divisions, leaving San Ramon officials wondering about the future of their city's second largest employer.
The company won't say which cities, or even which departments, would be affected by the cuts. The telecom giant employs 17,000 in the Bay Area, almost half of them in San Ramon.
"They're a very large employer and obviously have lots of employees that spend lots of money at retail businesses in San Ramon," said City Councilman John Livingstone.
AT&T was boosted by being the only carrier for the popular iPhone, but the layoffs in 2009 come on top of 4,600 jobs eliminated earlier this year.
AT&T spokesman John Britton said the company was adapting to consumer demand, as more households abandon traditional hard line phone service for mobile connectivity. He said customers would not notice any any impact on service because of the layoffs.
Tight-fisted consumers leave companies with little room when it comes to cutting costs, said UC Berkeley economist Robert Reich, who served as U.S. Secretary of Labor under former President Bill Clinton.
"Labor costs constitute about 70 percent of the costs of most companies," he said. "As the economy slows dramatically, those labor costs are the biggest thing looming on the company balance sheets."
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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