Posted on: Tuesday, November 25, 2003

Sprint to fire 2,000 more workers

By Tom Giles
Bloomberg News Service

Sprint Corp., the third-biggest U.S. long-distance telephone company by sales, said it would fire 2,000 workers, 2.9 percent of its staff, as it contends with falling long-distance sales.

Jobs will be cut in all divisions, including the wireless and long-distance units, said Mark Bonavia, a spokesman for Overland Park, Kan.-based Sprint.

In Hawai'i, Sprint said last week it would cut 30 jobs at the start of the year. Those jobs were part of this round of job cuts, and Sprint has no further plans to cut jobs in Hawai'i, a spokeswoman said.

Eliminating 2,000 jobs will bring Sprint's chief executive officer Gary Forsee closer to his goal of reducing annual costs by $1 billion by 2006. He is reorganizing the company into two main groups, one for corporate customers and one for consumers, to eliminate overlapping jobs and counter an 11-quarter slide in long-distance sales.

"We don't know how bad it's going to get" for long-distance carriers, said Edward Paik, manager of the $430 million Columbia Utilities Fund in Boston, which holds Sprint shares. "The companies know that, and as a pre-emptive measure they have to get costs down as fast as possible."

Shares of Sprint rose 18 cents to $15.56 at 4 p.m. in New York Stock Exchange composite trading. Stock that tracks the company's PCS wireless division rose 26 cents to $4.61.

Sprint's third-quarter revenue declined 1.2 percent to $6.71 billion as calling prices fell and customers defected to wireless competitors and to recent entrants in the long-distance market such as Verizon Communications Inc. The company had a loss of $498 million after $1.2 billion in costs for writing down the value of equipment it won't use.

Sprint has about 68,200 employees, Bonavia said. Including today's announcement, the carrier has unveiled plans to eliminate 19,000 jobs since October 2001.

Fired workers will be eligible for two weeks of pay and benefits for each full year of service, to a maximum of 52 weeks, Sprint said in a statement. Employees will receive at least 60 days of pay after they receive notices, Sprint said.