Yahoo Finance Telstra to cut 2,800 jobs but chief executive insists change won’t affect retail customers
Telstra has announced it will cut 2,800 jobs when overhauling its enterprise business, with the chief executive, Vicki Brady, saying it was a “very hard day” for the telecommunications giant.
Brady, in an announcement to the Australian Stock Exchange, said resetting the Telstra arm that services large businesses and government agencies would lead to a “streamlined product portfolio”, a reduced number of network applications and services products, and simplified customer sales and service.
Brady said on Tuesday that the majority of the roles being axed were in the enterprise business, with most to be finalised by the end of 2024. The company said it would consult with the union as part of the changes.
“The actions we are announcing today are difficult, but they are necessary to be a more efficient and sustainable business to ensure we can keep investing at the level required to meet the ever-increasing demand for our connectivity,” Brady told reporters.
“The jobs that we will commence consultation on today do not impact our consumer customer service team.”
The chief executive said the changes were needed to deal with inflation and higher energy costs – as well as tough market conditions.
“Our industry and the world we are operating in are changing. We have new and different competitors. We have rapid advances in technologies happening. Our customer needs continue to evolve and we have ongoing inflationary and cost pressures,” she said.
“At the same time, the need for better connectivity right across the country only continues to grow. We continue to see growth in data on our mobile network at 30% per annum.”
Brady said the growth in data meant the company needed to make significant ongoing investments in infrastructure.
The Communication Workers Union national assistant secretary, James Perkins, rejected Telstra’s claim that the cuts would not affect customer service.
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“While the detail of where exactly these jobs are being cut from is still unclear, one thing is certain – it will have a devastating impact on services,” he said.
“You can’t slash thousands of jobs without seriously impacting the delivery of services across the country. Telstra has to answer to this.”
In February, Telstra announced a review of its enterprise business. The review remains ongoing and Telstra said it came amid “challenging market conditions”.
As of mid-2023, Telstra had more than 31,000 employees. The company said it expected the restructuring to cost between $200m and $250m in the 2024 and 2025 financial years.
The company announced it would stop the annual price review for postpaid mobile plans falling in July and being tied to the consumer price index.
Brady would not say what this meant for the price of Telstra plans broadly, but said the company needed to consider a range of factors in its pricing beyond just CPI and there would be no pricing announcement in July.
